Income Tax judiciary-2

Deduction u/s 36(1)(ii) Allowed for Bonus Paid to Directors who are Shareholder of Company 

Mehta Equities Ltd. Vs DCIT (ITAT Mumbai)

The issue under consideration is whether the CIT(A) is correct in upholding the action of the Assessing Officer in making a disallowance under section 36(l)(ii) of the Act; being bonus paid to the Directors of the Company by holding that such payments are in lieu of dividend or profits?...

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Section 10AA Deduction eligible on Voluntary Transfer Pricing Adjustment by Assessee

EYGBS (India) LLP Vs DCIT (ITAT Bangalore)

The issue under consideration is whether denial of claim of deduction u/s 10AA of the Act on transfer pricing adjustment made by the assessee voluntarily is justified in law?...

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Delhi HC Restricts Penalty Imposed by Revenue on Tata Teleservices Ltd

Tata Teleservices Ltd. Vs Principal Commissioner of Income Tax (Delhi High Court)

The present writ petitions have been filed challenging orders issued by respondent authority whereby the penalty demand of Rs.293,28,50,153 for the assessment years 2006-07, 2007-08, 2008-09, 2009-10, and 2010-11 stayed subject to payment of 20% of the said amount....

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Section 80P Deduction eligible to Co-Op Bank Primarily engaged in Banking Business

The Chombal Service Co-operative Bank Limited Vs ITO (ITAT Cochin)

The issue under consideration is whether co-operative bank is eligible for deduction under section 80P of income tax Act, 1961 ? Co-Operative Bank is Also Eligible for Deduction u/s 80P if they Primarily Engaged in Business of Banking...

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Appeal Against Revisionary Section 263 should be Filed Before Tribunal: ITAT Mumbai

Viiking Technology and Trade Pvt. Ltd. Vs DCIT (ITAT Mumbai)

The issue under consideration is whether the ld. CIT(A) was justified in upholding the disallowance made on account of unverifiable purchases? Appel Against Revisionary Order u/s 263 should be Filed Before Tribunal: ITAT Mumbai...

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Section 68 Addition for Share Capital unjustified if Creditworthiness Proved

Sanmin Trading & Holding Pvt. Ltd. Vs ITO (ITAT Kolkata)

Sanmin Trading & Holding Pvt. Ltd. Vs ITO (ITAT Kolkata) The issue under consideration is whether addition made u/s 68 on the ground that the share capital received is seen not a genuine credit is justified in law? ITAT states that section 68 of the Act provides that if any sum found credited in the […]...

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CSR expenses incurred before 01.04.2015 deductible as business expenses

Garden Reach Ship Builders & Engineers Ltd. Vs PCIT (ITAT Kolkata)

The amendment brought about by way of Explanation 2 to section 37 by Finance Act, 2014, was only with effect from 01.04.2015. ITAT held that the amendment in question is not retrospective. Expenditure incurred in CSR in accordance with guidelines issued by the Govt. of India is allowable as a deduction for both A.Y. 2013-14 and A.Y. 2014...

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ITAT dismisses revenue appeal due to Monetary Limit & Assessee Appeal for non attendance

DCIT Vs Zorawar Vanaspati Ltd. (ITAT Delhi)

DCIT Vs Zorawar Vanaspati Ltd. (ITAT Delhi) The issue under consideration is whether the cross objection filed by the revenue regarding levying penalty u/s 234A and 234B of the Act on returned income is justified in law? ITAT states that as far as Revenue’s appeal is concerned, an undisputed fact that the Revenue’s appeal is […...

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Re-Opening of Assessment u/s 147 Merely Relying upon Investigation Report Not Justified in Law

Eminent Computers Pvt. Ltd. Vs ITO (ITAT Delhi)

Eminent Computers Pvt. Ltd. Vs ITO (ITAT Delhi) The issue under consideration is whether the re-opening of assessment u/s 147 merely relying upon investigation report is justified in law? ITAT states that the return of income filed by the assessee has also been analyzed with reference to the information received from the Investigation Win...

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Section 14A Disallowance r.w. Rule 8D cannot exceed Exempt Income

Ramalinga Mills Ltd. Vs ACIT (ITAT Chennai)

Ramalinga Mills Ltd. Vs ACIT (ITAT Chennai) The issue under consideration is whether disallowance of expenditure in relation to exempt income u/s.14A read with Rule 8D of I.T. Rules, 1962 is justified in law? ITAT states that, the facts borne out from records clearly indicate that the assessee has earned dividend for the impugned assessme...

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No TP adjustment for Overdue Receivables which already been considered in working capital adjustment

Bertelsmann Marketing Services India Pvt. Ltd. Vs DCIT (ITAT Delhi)

The issue under consideration is whether overdue receivables from AEs is considered as an international transaction? ITAT direct the learned transfer pricing officer to delete the addition on account of interest on overdue receivable from associated enterprise. Accordingly ground of the appeal is allowed....

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HC refuses to Prematurely pronounce in case related to Transfer Pricing

Hyundai Motor India Ltd. Vs Secretary, Income Tax Department (Madras High Court)

The issue under consideration is whether the writ petition filed against the order of DRP rather than first go for appeal before tribunal is justified in law?...

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Complemented Assessment cannot be reopened U/s. 147/148 on Borrowed Satisfaction

Hitesh Ashok Vaswani Vs DCIT (ITAT Ahmedabad)

Hitesh Ashok Vaswani Vs DCIT (ITAT Ahmedabad) The power to reopen a completed assessment under Section 147 of the Act has been bestowed on the Assessing Officer, if he has reason to believe that any income chargeable to tax has escaped assessment for any assessment year. However, this belief that income has escaped assessment has [&hellip...

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ITAT Remand Case to AO to Decide Treatment of Interest from FDR made for Contract Business

Manjit Singh Malhi Vs ACIT (ITAT Kolkata)

The issue under consideration is whether CIT(A) is correct in treating the interest from Fixed deposits made in connection with Contract business as income from ‘Other sources’ in place of income from ‘Business’?...

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No TDS u/s 194I on Payment for Acquisition of Leasehold Rights over Immovable Property

Nagarjuna Oil Corporation Ltd. Vs ACIT (Madras High Court)

The issue under consideration is whether payment for the acquisition of leasehold rights over immovable property is rental income and hence eligible for TDS u/s 194I ?...

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Depreciation not allowed on Leasehold Rights as same is not Intangible Assets

Mahanadi Coalfields Ltd. Vs DCIT (ITAT Cuttack)

The issue under consideration is whether the leasehold rights is considered as intangible assets and hence eligible for depreciation under section 32(1)(ii)? ITAT hold that the lease hold rights are not eligible for depreciation u/s.32(1)(ii) of the Act considering it as intangible rights and, accordingly, dismiss the ground of appeal of ...

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Money Transferred to Unregistered Trust cannot be treated as applied for Charitable Purpose

Maharaja Ranjit Singh War Museum Society Vs CIT (Punjab And Haryana)

Where the assessee transferred accumulated funds to unregistered trust then it was clear violation of Explanation to section 11(2) and clause (d) in sub-section (3) of section 11 and therefore same cannot be treated as applied for charitable purpose. Amount so transferred was thus liable to addition in the hands of the assessee-trust....

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Wife can Know Husband’s Income by filing RTI application: CIC

Rahmat Bano Vs. The CPIO, O/o the Income Tax Officer (Central Information Commission, New Delhi)

In a litigation, where the issue involved is of maintenance of wife, the information relating to the salary details no longer remain confined to the category of personal information concerning both husband and wife, which is available with the husband hence accessible by the wife. But in the present case, as stated earlier, the applicatio...

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Interest on business advances held as fixed deposit is Business Income

ACIT Vs National Film Development Corporation Ltd. (ITAT Mumbai)

ACIT Vs National Film Development Corporation Ltd. (ITAT Mumbai) We are of the opinion that considering the facts that assessee’s business -production of films for Ministries of Government of India and various government departments-and the durations for which the amounts were kept with banks the income earned by it has to held as b...

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Vijaya Bank can claim Section 36(1)(viii) deduction as Financial Corporation

CIT Vs Vijaya Bank (Karnataka High Court)

CIT Vs Vijaya Bank (Karnataka High Court) Learned counsel for the revenue submitted that prior to amendment with effect from 01.04.2008, benefit of Section 36(1)(viii) of the Act was not available to a Banking Company and therefore, the assessee is not entitled to claim deduction under Section 36(1)(viii) of the Act. It is further submitt...

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Foreign tax credit available even on income not subjected to tax in India except foreign tax paid in Finland & Canada

Tata Consultancy Services Ltd. Vs Addl. CIT (ITAT Mumbai)

Tata Consultancy Services Ltd. Vs Addl. CIT (ITAT Mumbai) As could be seen, while the Assessing Officer has disallowed assessee’s claim of foreign tax credit in respect of income exempt under section 10A/10AA of the Act on the reasoning that only such income which is subjected to tax in both the countries would qualify for […...

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Prosecution can be launched before Income Tax Assessment completion : HC

Rohit Kumar Nemchand Piparia Vs Deputy Director of Income Tax (Madras High Court)

Prosecution proceedings were separate and distinct from the assessment or re­assessment proceedings. There was no requirement under the Act that the assessment proceedings should be completed before launching prosecution. HC refused to quash prosecution for the compounding of offense under Section 276C(1) of Income Tax Act....

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Service Tax will not form part of aggregate amount for section 44BB

BAKR Hughes Singapore PTE Vs Addl. Director of Income Tax International Taxation (Uttarakhand High Court)

The issue under consideration is whether amount of service tax being statutory levy, received by assessee from its customers was to be included in calculating the aggregate amount referred to in sub-section (2) of Section 44BB of the Act?...

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No TP adjustment for delayed receivables if Same is already been factored in working capital adjustment

Barco Electronic Systems (P) Ltd. Vs DCIT (ITAT Delhi)

Barco Electronic Systems (P) Ltd. Vs DCIT (ITAT Delhi) We have noted that the assessee is not charging interest on overdue debts from the third parties and also the assessee is a debt free company and not paying any interest on funds utilized is business. We have also noted that the assessee company has a […]...

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ITAT excludes comparable having turnover more than 31 to 62 times

Transcend MT Services Pvt. Ltd. Vs DCIT (ITAT Delhi)

Transcend MT Services Pvt. Ltd. Vs DCIT (ITAT Delhi) Assessee has also argued for exclusion of Infosys BPO Ltd, which is having the turnover more than 31.29 times, and TCS E serve Ltd having turnover of 62 times larger than the assessee does. Therefore, for the reasons given by us for exclusion of I gate […]...

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TDS not deductible on Agency Commission paid to Overseas Agents not having PE in India

DCIT Vs Shamrock Pharmachemi Pvt.Ltd. (ITAT Mumbai)

DCIT Vs Shamrock Pharmachemi Pvt.Ltd. (ITAT Mumbai) We find that assessee is engaged in the business of trading activity of import and export of pharmaceutical ingredients, chemicals and intermediates. We find that the assessee debited a sum of Rs. 4,18,50,792/- in its profit and loss account towards export commission paid to overseas age...

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Interest paid on borrowed funds used for business cannot be disallowed

ACIT Vs Chinsha Property Pvt Ltd. (ITAT Mumbai)

ACIT Vs Chinsha Property Pvt Ltd. (ITAT Mumbai) Since the company was engaged in the business of real estate, property in Tulsiwadi was acquired for redevelopment. Hence, commercial expediency/business purpose assessee had invested ₹.11.25 Crores in the project. Therefore, interest cannot be disallowed. Ld. DR submitted that Assessing O...

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Section 41(1) No Addition without evidence of cessation of trading liability

Nama Properties Ltd. Vs DCIT (ITAT Hyderabad)

Nama Properties Ltd. Vs DCIT (ITAT Hyderabad) In the decisions relied upon by the learned Counsel for the assessee it was held that the genuineness of the trade payables or creditors has to be examined in the year in which they originate and that unless the liability becomes unenforceable or is written off by the […]...

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HC set aside Tribunal order for failure to records that finding of AO was erroneous

PCIT Vs Rakesh Sarin (Madras High Court)

Court under Section 260A would not interfere with the Tribunal's finding of fact could not be applied to the facts of case because the Tribunal did not record any finding of fact that the finding of fact recorded by AO was erroneous and not borne out by records. Thus, the order passed by Tribunal for not calculating the undisclosed income...

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IT Department cannot access data of other clients of a CA if search related to one particular client

S.R. Batliboi & Co. Vs Department of Income Tax (Investigation) (Delhi High Court)

S.R. Batliboi & Co. Vs Department of Income Tax (Investigation) (Delhi High Court) Conclusion: If apparently reliable material could not be directly used against an assessee solely because it was not collected during a Search of that assessee, a fortiori, material palpably concerning a third party with no connection with the raided pa...

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No section 54 Deduction denial for mere Non-Completion of Construction of New House

Estate of Late Dr. S. Zakaulla Masood Vs ITO (ITAT Bangalore)

The issue under consideration is whether the CIT(Appeals) was justified in denying the benefit of deduction to assessee u/s. 54 of the Income Tax Act, 1961?...

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ITAT Restricts addition for Bogus Bills at 5% of bogus purchases

Suresh Mehta HUF Vs ITO (ITAT Mumbai)

The issue under consideration is whether the CIT(A) is correct in confirming the addition made by AO for non-genuine and bogus purchases by applying profit rate at the rate of 12.5% of the bogus purchases?...

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ITAT deletes Addition of sales tax incentive receipt in case of RIL

Reliance Industries Ltd. Vs ACIT (ITAT Mumbai)

Reliance Industries Ltd. Vs ACIT (ITAT Mumbai) The issue under consideration is whether deletion of addition of sales tax incentive/ subsidy as capital in nature is justified in law? In the present case, the assessee in this case is engaged in the business of oil and gas exploration, refining of crude oil, manufacturing of and […]...

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Interest Income on FDR’s Pledged to obtain Contract is Business Income

Awasthi Traders Vs DCIT (ITAT Agra)

The issue under consideration is whether the interest income on FDR’s pledged for security purposes in obtaining the contract business comes within the ambit of business income?...

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No addition for Share application money if Recipient company proves identity, genuineness of transactions & creditworthiness of parties

Network Synthetics Pvt. Ltd Vs DCIT (ITAT Mumbai)

Network Synthetics Pvt. Ltd Vs DCIT (ITAT Mumbai) It is observed that the assessee has discharged its initial onus to prove the identity, genuineness of the transaction and creditworthiness of the parties by filing all these documents. The Tribunal in assessee’s group cases while deleting the additions made u/s. 68 of the Act observed a...

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No revision if assessment order was not prejudicial to interests of Revenue

Shri Jitendra Patidar (L/H of Late Shri Satyanarayan Patidar) Vs Pr. CIT (ITAT Indore)

Provisions of section 263 could be invoked when twin conditions i.e. the assessment order was erroneous and prejudicial to the interest of Revenue were satisfied. Revision under section 263 could not be invoked if assessment order was not prejudicial to the Revenue....

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ITAT Sustains Addition for Cash Gifts Received for Marriage, Anniversary & Cancer Treatment from Relatives as evidence was absent

Late Smt. Vineeta Singh Vs ACIT (ITAT Delhi)

The issue under consideration is whether addition made by AO for the cash gifts found in search which is received at the time of marriage and anniversary and cash for cancer treatment is justified in law?...

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In Section 263 Assessment AO cannot go beyond Directions of CIT: Madras HC

CIT Vs Lakshmi Machine Works Ltd. (Madras High Court)

CIT Vs Lakshmi Machine Works Ltd. (Madras High Court) The issue under consideration is whether the AO can go beyond the directions of CIT, even though during the course of fresh assessment proceedings, it is open to the AO to examine any items other than specific item ? High Court states that, the jurisdiction exercised […]...

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Section 195 TDS Applicable on Software Purchase Expenses incurred by Distributor

Kaseya Software India Private Limited Vs DCIT (ITAT Bangalore)

The issue under consideration is whether the CIT(A) is correct in stating that TDS u/s 195 applicable on software expenses without appreciating the fact that appellant was merely acting as a distributor and not having right to have a copy of the software?...

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Section 143(2) Notice to Erstwhile Non-Existent Partnership Firm is Void-ab-Initio

Intas Lifesciences Vs ACIT (ITAT Ahmedabad)

The issue under consideration is whether AO is correct in issuing notice u/s 143(2) in the name of erstwhile partnership firm which was a non-existent entity at that point of time?...

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Mere depreciation claim on Goodwill cannot be termed As Colorable

Urmin Marketing P.Ltd. Now known as Unicorn Packaging LLP Vs DCIT (ITAT Ahmedabad)

Urmin Marketing P.Ltd. Now known as Unicorn Packaging LLP Vs DCIT (ITAT Ahmedabad) Vs DCIT (ITAT Ahmedabad) Scheme of the amalgamation can be approved under the provisions of section 2(1B) of the Act where shareholders holding not less than 75% in the value of shares of the amalgamating company become the shareholders of the amalgamated [...

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Providing Information regarding ongoing Income Tax investigation to informer is not appropriate: HC

Principal Director, Income Tax (Investigation) Vs Rajiv Yaduvanshi & Ors. (Delhi High Court)

Principal Director, Income Tax Vs Rajiv Yaduvanshi (Delhi High Court) Moreover, in cases pertaining to Tax evasion petitions like the present case, this Court also exercises its powers sparingly and it is a well-settled principle that only the broad outcome of the Tax evasion petition may be communicated to the complainant, that too upon ...

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Section 10(34) & 10(38) exemption on dividend & LTCG of VCU earned by SARA Fund

Japan International Co-operation Agency (JICA) Vs ACIT (Intl. Taxation) (ITAT Delhi)

Japan International Co-operation Agency (JICA) Vs ACIT (ITAT Delhi) A.O. as well as Ld. CIT(A) have taken a wrong view by holding that the assessee cannot grow tax-free income u/ss 10(34) and 10(35) of the Acts unless additional tax has been paid as per the provisions of Sections 115-0 and 115-R of the Act and […]...

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Income from time charter services rendered by vessel cannot be treated as ‘royalty‘

Smit Singapore Pte Ltd. Vs DCIT (ITAT Mumbai)

Smit Singapore Pte Ltd. Vs DCIT (ITAT Mumbai) Assessee had received charges on account of time charter services rendered by its vessel ‘Smit Borneo‘ along with the crew to Leighton India Contractor Pvt. Ltd., and not for allowing the latter the ‘use‘ or ‘right to use‘ of industrial, commercial, or scientific equipm...

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HC denies relief to CIT accused of Corruption & causing loss of Rs. 7.26 crores to revenue

S. K. Srivastava Vs Central Bureau Of Investigation And 4 Ors. (Allahabad High Court)

The petition is filed by retired official o quash charges in respect of offences of cheating, criminal conspiracy and Corruption against CIT(A)....

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Method of Accounting Can’t be Rejected u/s 145 Without Examination of Books

VRB Foods Pvt. Ltd. Vs DCIT (ITAT Delhi)

The issue under consideration is whether rejection of method of accounting under section 145 without even examination of books of assessee is justified in law?...

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Section 56(2)(vii)(b) Not Applicable if It Is Not Enacted as on Date of Agreement

ACIT Vs Sri Anala Anjibabu (ITAT Visakhapatnam)

The issue under consideration is whether provisions of section 56(2)(vii)(b)(ii) are applicable on difference between consideration paid for purchase of property and SRO value as on date of agreement?...

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Section 147/148 proceedings on mere investigation wing information was not valid

Hitesh Ashok Vaswani Vs DCIT (ITAT Ahmedabad)

Hitesh Ashok Vaswani Vs DCIT (ITAT Ahmedabad) In the present case the search information received from the investigation wing was used to form the reason to believe by the AO but without applying the mind. Thus the reasons were merely recorded on the borrowed satisfaction by the AO. The source for all the conclusions was […]...

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Secondary & higher education cess deductible as business expenditure

Aptean India Pvt. Ltd. Vs DCIT (ITAT Bangalore)

Aptean India Pvt. Ltd. Vs DCIT (ITAT Bangalore) Assessee submitted that’s education says and secondary and higher education cess has been duly discharged by assessee while computing tax liability under normal provisions of income tax act. Placing reliance on following decisions Ld.AR submitted that ‘cess’ is deductible as business e...

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Valid issuance of notice u/s 143(2) mandatory for framing scrutiny assessment

Balaji Enterprise Vs ACIT (ITAT Guwahati)

Balaji Enterprise Vs ACIT (ITAT Guwahati) The case of the assessee was reopened u/s 148 by the ACIT, Investigation, Delhi, on the basis of CBI search. When the question of jurisdiction came before the Hon’ble High Court, it was held that where the assessee shifts his residence etc., the AO of the place where the […]...

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ITAT upheld Penalty u/s 271AAB(1) on Undisclosed Investment

Pawan Mundra Vs DCIT (ITAT Jaipur)

Pawan Mundra Vs DCIT (ITAT Jaipur) The issue under consideration whether AO is justified levying penalty under section 271AAB on failure to offer explanation about the source of the undisclosed investment in land? ITAT states that during course of post search proceedings, assessee admitted an income of Rs. 6,00,000 on account of undisclos...

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Land owner can claim Section 80-IB(10) despite no expense on Housing Project

CIT Vs Astoria Leathers (Madras High Court)

The issue under consideration is whether Tribunal was correct and justified in directing the AO to allow deduction under section 80-IB(10) to assessee land owner when it had not incurred any expenses towards development or construction of the housing project?...

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ITAT explains Tax on Payments received by retired partner

Dr. Vithal V. Kamat Vs JCIT (ITAT Mumbai)

Hon’ble Supreme Court in the case of CIT v. Tribhuvandas G. Patel (supra) has held that any amount paid to the partner upon his retirement towards his share in assets is not a transfer within the meaning of section 47(ii) of the Act and not liable to capital gain....

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Interest disallowance Justified if Commercial Expediency not established

DCIT Vs Alok Industries Limited (ITAT Mumbai)

DCIT Vs Alok Industries Limited (ITAT Mumbai) Issue raised is with respect to disallowance under Section 36(1)(iii) of the Act. The Revenue contends that assessee did not have adequate interest free funds, and that assessee could not establish commercial expediency. The disallowance in this regard has been done on the same reasoning as in...

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Section 54F deduction cannot be denied for subsequent letting of property for commercial use

CIT Vs Ramesh Shroff (Madras High Court)

The issue under consideration is whether deduction u/s 54F can be denied for the reason that assessee had later on let out new property for commercial purpose to run restaurant?...

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Works of Supply of Water, Disposal of Sewerage Considered as Charitable Activities & Eligible for Exemption u/s 11

PCIT (Exemptions) Vs Surat Urban Development Authority (SUDA) (Gujarat High Court)

The issue under consideration the activity of preparation of development plans and to execute works in connection with supply of water, disposal of sewerage and provisions of other services is considered as “charitable activities” and eligible for exemption u/s 11?...

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Depreciation on Imported Software Not Considered as Royalty & Not Liable for Disallowance u/s 40(a)(ia)

Wifi Networks Pvt. Ltd Vs DCIT (ITAT Bangalore)

The issue under consideration is whether depreciation on ‘imported software’ will be considered as royalty and liable for disallowance under section 40(a)(ia) for want of TDS?...

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To acquire section 153C Jurisdiction, Documents Seized must be Incriminating

ACIT Vs Realtech Construction Pvt. Ltd. (ITAT Delhi)

The issue under consideration is whether to acquire jurisdiction under section 153C is it require that the seized documents must be incriminating and must relate to the assessment year whose assessment were sought to be reopened?...

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Section 80IA(4) deduction eligible on developing / providing Lift Irrigation Scheme/ Lift Water Supply Scheme

Unipro Techno Infrastructure Private Ltd Vs DCIT (ITAT Chandigarh)

Unipro Techno Infrastructure Private Ltd Vs DCIT (ITAT Chandigarh) The brief facts relating to the issue are that the assessee is primarily engaged in developing / providing Lift Irrigation Scheme/ Lift Water Supply Scheme for different state governments. The assessee claims that the said development work carried out by the assessee falls...

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Delete TP adjustment by way of royalty Against Himalaya Drug Company- ITAT Directs AO

The Himalaya Drug Company Vs ACIT (ITAT Bangalore)

Himalaya Drug Company Vs ACIT (ITAT Bangalore) We noticed that the assessee has exported finished goods to its AEs located in various Countries and the AEs have only marketed the goods. Since the finished goods exported by the assessee are drugs and beauty care items, the assessee was required to comply with the requirement of […]...

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Section 12A exemption cannot be denied without considering merits of the case

Thanthi Trust Vs DIT (Madras High Court)

Thanthi Trust Vs DIT (Madras High Court) Whether the Tribunal was right holding that the appellant trust is not eligible for exemption under Section 12A of the Income Tax Act, 1961 without considering the merits of the case in a proper manner? In the case on hand, there is no allegation that the assessee Trust […]...

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Stamp duty, registration charges on Transfer of Capital Assets Allowable

DCIT Vs B. E. Billimoria & Co. Ltd. (ITAT Mumbai)

DCIT Vs B. E. Billimoria & Co. Ltd. (ITAT Mumbai) The material on record would show that the assessee being resident corporate assessee was assessed for the year under consideration u/s. 143(3) on 27/10/2017. During assessment proceedings, it transpired that the assessee sold an office premises vide agreement dated 31/03/2015 for a co...

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Assessee can be asked to prove Source of Credits but Not Source of Source

Lalchand P. Dhariwal Vs ITO (ITAT Surat)

The issue under consideration is whether the addition made u/s 68 against unexplained creditors will be sustainable in law? Assessee Can Asked to Prove the Source of Credits in his Books of Accounts but Not Source of Source....

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Metal Purchases from grey market- ITAT upheld 12.5% Addition

ITO Vs Gautam B. Bafna (ITAT Mumbai)

ITO Vs Gautam B. Bafna (ITAT Mumbai) In the instant case, the corresponding sales made out of disputed purchases were not doubted by the Ld. AO before us. No contrary evidence to this effect was also produced by the Ld. DR before us. It is not in the dispute that the assesee had indeed made […]...

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No capital gain tax in absence of transfer of shares

ACIT Vs Safari Mercantile Pvt. Ltd. (ITAT Mumbai)

ACIT Vs Safari Mercantile Pvt. Ltd. (ITAT Mumbai) Conclusion: Where there was no transfer of shares but only a pledge of shares for purposes of obtaining a loan and revenue not disputed the fact of return of loan and also receipt of pledged shares creditor, no capital gain could be charged. Only income was actually […]...

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In absence of enduring nature Product development expenses are revenue expense

ACIT Vs Setco Automobiles (ITAT Ahmedabad)

ACIT Vs Setco Automobiles (ITAT Ahmedabad) In the present case, the issue is about allowability of product development expenses which were held by A.O. be a capital in nature. We find that ld. CIT(A) while deciding the appeal for A.Y. 2002-03 and following it has given a finding that due to incurring of product development […]...

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Subsidy cannot be treated as a payment to meet any portion of actual cost of Capital Asset

ACIT Vs Inox Air Products Private Limited (ITAT Pune)

ACIT Vs Inox Air Products Private Limited (ITAT Pune) The only issue raised in the assessee’s appeal is against  the direction of the ld. CIT(A) for reducing the amount of subsidy from the value of assets for the purpose of granting depreciation. From Explanation 10 to section 43(1) of the Act it is immensely clear […]...

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Income from Amenities forming Part & Parcel of Building taxable as House Property Income

Nirmala Zaverchand Shah Vs DCIT (ITAT Mumbai) 

The issue under consideration is whether amenities being part and parcel of building will be tax under head 'Income from house property’ or ‘Income from other sources’?...

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Interest expense having nexus with earned interest income allowable

Ravi Mohan Gehi Vs DCIT (ITAT Mumbai)

Ravi Mohan Gehi Vs DCIT (ITAT Mumbai) Conclusion: Assessee was into arranging funds and earned interest income by refinancing to the other parties and the difference in the rates in refinancing was the income of assessee. It was the nature of the business and all the expenditure incurred in earning the income was allowable expenditure. [&...

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Conditions of Rule 18DA(8A) can be Looked into Only by Prescribed Authority & Not by the AO

CIT Vs M/S Quintiles Research (India) Private Limited (Karnataka High Court)

The issue under consideration is whether the Tribunal is right in holding that the conditions of Rule 18DA(8A) can be looked into only by the prescribed authority and not by the Assessing Officer?...

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Container Freight Station Constitutes Inland Port Hence Eligible for Deduction u/s 80IA(4)

PCIT Vs Sanco Trans (Madras High Court)

The issue under consideration whether deduction under section 80IA(4) can be claimed on Container Freight Station (CFS) as it constitutes an ‘inland port’? Container Freight Station Constitutes as Inland Port Hence Eligible for Deduction u/s 80IA(4)....

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Expense on Microsoft EAS licence renewal of AXABS software: ITAT remands case back to CIT(A)

AXA Business Services Pvt. Ltd. Vs DCIT (ITAT Bangalore)

AXA Business Services Pvt. Ltd. Vs DCIT (ITAT Bangalore) We have considered the rival submissions. We find that despite all the details having been filed by the assessee before the CIT(Appeals), the CIT(Appeals) has not considered those submissions with regard to the sum disallowed by the AO, except the sum of Rs.81,52,209 which was incur...

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100% Addition for Bogus Purchase not sustainable if Sales were accepted by AO

ITO Vs Vipul K Sheth (ITAT Mumbai)

ITO Vs Vipul K Sheth (ITAT Mumbai) In the present case the AO has not doubted the sales. The assessee could not establish the genuineness of the transaction to the satisfaction of the AO during assessment proceedings. Hence, from the facts of the case it can be concluded that assessee had made purchases from grey […]...

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Deduction Claimed as R&D Expense For Development on Mechanism to Produce Customised Products Allowed

Harsha Engineers Ltd. Vs DCIT (ITAT Ahmedabad)

The issue under consideration is whether deduction can be claimed under Research and Development (R&D) for Amount incurred towards development on a mechanism to produce customised products?...

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Income From Land Sale by Assessee Engaged in Property Development Taxable as Business Income

Ashok Kumar Chouta Vs DCIT (ITATBangalore)

The issue under consideration is whether land sold by assessee engaged in property development taxable as capital gains or business income?...

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Sale of Agricultural Land after Conversion is Taxable as Capital Gain

Ramesh Raj Bohra Vs DCIT (ITAT Jodhpur)

The issue under consideration is whether sale of agricultural land after conversion taxing under capital gain or under business income? ITAT direct the A.O. to treat the property on sale of land as capital gains and given the benefit of exemption claimed by the assessee U/s 54F of the Act....

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Section 68 Addition Justified for Unexplained Gifts Received from Non-Related Donor

Meenu Jain Vs ITO (ITAT Delhi)

The issue under consideration is whether the CIT (Appeals) has grossly erred in confirming the addition as made by the Assessing Officer (AO) on account of gifts u/s 68? Addition u/s 68 Justified for Unexplained Gifts Received from Non Related Donor....

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Booking fees received from Airlines is business income: ITAT Delhi

Amadeus IT Group SA Vs Asstt. DIT (ITAT Delhi)

Amadeus IT Group SA Vs Asstt. DIT (ITAT Delhi) The AO has held that the income received by the assessee with respect to bookings arising from India is also taxable as royalty income. The AO observed that the assessee supplies/ licenses its proprietary products free of charge to Amadeus India for distribution to the Subscribers. […]...

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No reopening of Assessment after 4 Year if no failure of Assessee in disclosing relevant facts

CIT Vs Sterling Tree Magnum India Ltd. (Madras High Court)

CIT Vs Sterling Tree Magnum India Ltd. (Madras High Court) Learned Tribunal has categorically held that there was no failure on the part of the assessee, but disclosed the relevant facts and therefore, merely on the basis of the audit objection or change of opinion and re-assessment under Sections 147 & 148 of the Income […]...

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No penalty if no deliberate attempt to evade payment of taxes

Advent Computer Services Ltd. Vs ACIT (ITAT Chennai)

Advent Computer Services Ltd. Vs ACIT (ITAT Chennai)  It is an admitted fact that assessee has not reported capital gain derived from transfer of equity shares in pursuant to the direction of the Hon’ble High Court of Madras for amalgamation of M/s. i Theories Business Factory India Pvt. Ltd., with the assessee company, even though [&h...

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Revenue to establish proximate relationship between expenditure & exempt income for section 14A disallowance

CIT Vs Sociedade De Fomento Industrial Pvt. Ltd (Bombay High Court at Goa)

CIT Vs Sociedade De Fomento Industrial Pvt. Ltd (Bombay High Court) Here, on facts, the Tribunal noted that the AO only discussed the provisions of section 14A(l) but has not justified how the expenditure the Assessee incurred during the relevant year related to the income not forming part of its total income. The AO, according […]...

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FMV of shares: Jurisdiction of AO to reject valuation methods adopted by Assessee

Canvera Digital Technologies Pvt. Ltd Vs DCIT (ITAT Bangalore)

Canvera Digital Technologies Pvt. Ltd Vs DCIT (ITAT Bangalore) From the details filed, Ld.AO observed that, assessee had computed the value as per DCF method and that there was nothing to suggest that DCF method was an appropriate method to value the shares. Ld.AO rejected DCF method adopted by assessee for the reasons that cash […...

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Intermediary services not amount to FTS & not taxable under India-Sweden DTAA

Bombardier Transportation Sweden AB Vs DCIT (ITAT Delhi)

Bombardier Transportation Sweden AB Vs DCIT (ITAT Delhi) Conclusion: Payment of consideration would be regarded as ‘fee for technical/included services’ only if the twin test of rendering services and making technical knowledge available at the same time was satisfied. Intermediary services rendered by assessee did not make av...

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Additions in reopened Assessment not valid if no addition on subject matter of reopening

Sheela Foam Ltd. Vs DCIT (ITAT Delhi)

The issue under consideration is whether the re-opening of assessment is valid even if there is no addition on subject-matter being basis for issuing notice under section 148, rather AO made addition on other counts?...

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Commission to Director in terms of Employment is Part of Salary: ITAT Delhi

DCIT Vs Abro Technologies Pvt. Ltd. (ITAT Delhi)

Commission paid to Director in terms of Employment is Considered as Part of Salary. It is also not disputed that TDS has been deducted on such commission as salary. Accordingly, the Revenue’s appeal is dismissed....

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Profit margin disclosed by assessee cannot be rejected arbitrarily

Sukhwinder Singh Vs ACIT (ITAT Delhi)

The issue under consideration is whether addition made by AO by application of N.P. rate of 8% is justified in law? Profit Margin Cannot be Rejected Arbitrarily due to Rejection of Books of Account...

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Assessee holding General Power of Attorney with respect of Land Sold Not Liable for Capital Gains

ITO Vs Sejal Gopalbhai Shah (ITAT Ahmedabad)

ITO Vs Sejal Gopalbhai Shah (ITAT Ahmedabad) The issue under consideration is whether capital gain will be taxed in the hands of general power of attorney holder with respect to land sold? ITAT states that, the assessee was just general Power of Attorney holder with respect to the lands in dispute. This fact has not […]...

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Risk adjustment / Benchmarking of international transactions- ITAT Remands case back to AO

GCO Technologies Centre Private Ltd. Vs ITO (ITAT Mumbai)

GCO Technologies Centre Private Ltd. Vs ITO (ITAT Mumbai) We have deliberated at length on the aforesaid issue under consideration and are unable to persuade ourselves to subscribe to the projection of the aforesaid comparable company viz. M/s Cather Consultancy Services Pvt. Ltd by the assessee as a profit making company during the finan...

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ITAT Allowed Deduction of Municipal Taxes on Area Not Leased Out

Dream Motels (P) Ltd. Vs ITO (ITAT Mumbai)

Dream Motels (P) Ltd. Vs ITO (ITAT Mumbai) The issue under consideration is whether treating municipal taxes paid is considered as a part of rent liable to be taxed u/s 23 of the act? ITAT states that, upon due consideration of factual matrix, the crystal-clear position that emerges is the fact that as per the […]...

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Modification due to Notification has Effect of Deleting Old Rule & Making New Rule Operative

DIT Vs Autodesk Asia Pvt Ltd (Karnataka High Court)

whether the Tribunal was correct in holding that the assessee is liable to be taxed at 10% in view of replacement of 15% with 10% of tax in Article 12 of the DTAA without taking into consideration that the modification of rate of tax by way of notification?...

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Income from Sale of Land which was held as Investment is Capital Gain

CIT Vs Kishan House Builders Association (Karnataka High Court)

CIT Vs Kishan House Builders Association (Karnataka High Court) The issue under consideration is whether the sale of land which is held as investment is considered as capital gains or business income? High Court states that, from perusal of the entries it is evident that the assessee has not conducted any other activity other than [&helli...

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Income-Tax Payment made by Assessee is Application of Income & it is Eligible for Deduction u/s 11

DCIT (Exemptions) Vs Cargo Handling Pvt. Workers Pool Trust (ITAT Visakhapatnam)

The issue under consideration is whether the Income-tax payment made by assessee is an application of income and will be eligible for deduction u/s 11?...

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Interest received from Jaipur Central Co-op Bank eligible for section 80P(2)(d)deduction

Shahpura Gram Seva Sahakari Samiti Ltd. Vs ITO (ITAT Jaipur)

The issue under consideration is whether the interest received by the assessee from the Cooperative Bank is eligible for deduction under section 80P(2)(d) of the Income Tax Act?...

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If Assessee Engaged in Accommodation Entries Only Commission to be Added on Estimation Basis

Arydeep Developers Pvt. Ltd.Vs ITO (ITAT Ahmedabad)

The issue under consideration is whether for assessee engaged in providing accommodation entries only commission amount to be added on estimation basis or entire amount of accommodation entry to be added?...

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Premature Disclosure of Pending tax Investigation to Media Not Justified in Law

Rajendran Chingaravelu vs Addl. CIT (Supreme Court of India)

The issue under consideration is whether the proceedings of enquiry/investigation undertaken at the airports without keeping it confidential and premature disclosure to the media (print/electronic) is justified in law?...

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Section 14A disallowance cannot exceed amount of exempt Income

Brindavan Beverages Pvt.Ltd. Vs DCIT (ITAT Banglore)

The issue under consideration is whether the disallowance u/s 14A can exceed the amount of exempt income? In the light of the order of M/s.Century Real Estate Holdings Pvt. Ltd. v. ACIT (supra), ITAT hold that the disallowance u/s 14A of the I.T.Act cannot exceed the exempt income....

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Section 54EC – ITAT explains deduction of Rs. 50 Lakh & Rs. 1 Crore

Sri Arun Kumar B M Vs ITO (ITAT Bangalore)

Arun Kumar B M Vs ITO (ITAT Bangalore) The Assessing Officer held that the assessee is required to invest Rs.50 lakh in REC Bonds in any financial year. The Assessing Officer also relied on the amendments made to section 54EC of the I.T.Act vide Finance Act, 2014 w.e.f. 01.04.2015. Assessee has filed this appeal before […]...

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No section 68 Addition in Absence of Primary & Independent Enquiry by AO

Homeway Marketing (P) Ltd. Vs ITO (ITAT Delhi)

The issue under consideration is whether the addition made u/s 68 for assessee helped various beneficiaries in providing accommodation entries in relation to capital and expenses is justified in law?...

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ITAT Deletes section 14A disallowance made without following procedures

Standard Chartered Grindlays Bank-Tax Department Vs ACIT (ITAT Delhi)

The issue under consideration is whether CIT(A) is correct in disallowing managerial and administrative expenses for earning dividend income by treating this as tax free income?...

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