ITAT Delhi

Mitsui India is not a Dependent Agent Permanent Establishment of Mitsui, Japan

ACIT Vs Mitsui & Co. Ltd. (ITAT Delhi)

ACIT Vs Mitsui & Co. Ltd. (ITAT Delhi) The facts in brief are that the assessee-company is incorporated in Japan and had a subsidiary in India, Mitsui India Pvt. Ltd. (MIPL). In India, assessee has undertaken several projects in connection with big natural installment and power projects during the relevant year through its project off...

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ITAT allows credit of taxes paid in UK for remuneration received in UK

Kapil Dev Ranwan Vs DCIT (ITAT Delhi)

Kapil Dev Ranwan Vs DCIT (ITAT Delhi) It is pertinent to note that the assessee was working in UK for more than 183 days which was never disputed by the Revenue at any point of time. Besides this the Revenue authorities are very well aware that the assessee has paid taxes in UK for the […]...

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Addition by AO not based on any incriminating material, cannot be sustained in orders passed u/s 153A/143(3)

ACIT Vs Moon Beverages Ltd. (ITAT Delhi)

ACIT Vs Moon Beverages Ltd. (ITAT Delhi) Since the additions in the other appeals also are not based on any incriminating material found during the course of search and since we have already held that statements recorded u/s 132(4) are not incriminating in nature, therefore, the addition made by the AO being not based on […]...

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Comparables dissimilar in Functionally & Turnover cannot be included by TPO

Agilent Technologies India Pvt. Ltd Vs DCIT (ITAT Delhi)

Agilent Technologies India Pvt. Ltd Vs DCIT (ITAT Delhi) With respect to the Infosys technologies it is the claim of the assessee that the turnover of the above company is such a huge turnover that it is not comparable with the assessee company is software development division. For this proposition we look at page number […]...

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ITAT Allows Depreciation on Capitalised Jamnagar Loni Pipeline & Gandhar Plant Cost to GAIL

Gail (India) Ltd. Vs ACIT (ITAT Delhi)

Gail (India) Ltd. Vs Addl. CIT (ITAT Delhi) The rebuttal of the assessee have been considered thoroughly with the relevant documentary evidences referred therein and placed in the paper book. Considering the facts in totality, we are of the considered view that assessee has successfully commissioned the Jamnagar Loni Pipeline and the LPG ...

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Gail allowed section 801/ 80IA deductions on Lean gas Manufacturing / Processing

Gail (India) Ltd. Vs DCIT (ITAT Delhi)

Gail (India) Ltd. Vs DCIT (ITAT Delhi) ITA No. 5775/Del/2014 and ITA No. 5912/Del/2014 are cross appeals by the assessee and revenue preferred against the order of the CIT(A)-LTU, New Delhi dated 28.8.2014 pertaining to assessment year 1998-99. Both these appeals were heard together and are disposed of by this common order for the sake [&...

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ITAT remands back the issue of Section 271(1)(c) Penalty to AO

Fox Mandal & Co. Vs ACIT (ITAT Delhi)

Fox Mandal & Co. Vs ACIT (ITAT Delhi) It is an admitted fact that despite number of opportunities granted by the Ld. CIT(A), there was no compliance from the side of the assessee for which the Ld. CIT(A) was constrained to decide the appeal exparte and thereafter sustained the penalty levied by the AO u/s. […]...

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Deduction u/s 54F Not Eligible for Investment Made in two Differently Placed Properties

Omkar Chadha Vs ITO (ITAT Delhi)

The issue under consideration is whether the investment made in two different properties out of the capital gains is eligible for deduction u/s 54F?...

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Revenue Generated from Bookings Made within India Attributable to PE, Hence Taxable in India

DDIT Vs Travelport L.P. USA (ITAT Delhi)

The issue under consideration is whether revenue generated from the bookings made within India is the revenue attributable to the PE of the assessee is taxable in India?...

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Income Tax cannot be levied on Securities Premium Merely because It Used to Set Off Losses

Hindustan Coca Cola Beverages Private Limited Vs DCIT (ITAT Delhi)

The issue under consideration is whether tax is applicable on securities premium merely because it used to set off losses? AO does not have the jurisdiction to go beyond the net profit shown in the Profit & Loss Account except to the extent provided in the Explanation to section 115J....

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Claim Allowed in Original Assessment Cannot be Amenable to Provisions of Section 147/148

TCG Development India Private Limited Vs ITO (ITAT Delhi)

The issue under consideration is whether the notice issued under section 147 for re-opening of assessment is justified in law? A claim which has been allowed in the original assessment proceedings after examination of the relevant details and facts cannot be amenable to provisions of Section 147/148 of the Act....

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ITAT Remand Case to AO for Determining ALP of Purchase Transaction of FA by Appellant to its Overseas AEs

Denso India Pvt. Ltd Vs DCIT (ITAT Delhi)

The issue under consideration is whether rejecting the benchmarking approach and methodology followed by the Appellant for determining the ALP of the transactions pertaining to purchase of fixed assets by the Appellant to its overseas AEs is justified in law?...

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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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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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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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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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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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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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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 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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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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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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No section 14A disallowance if no exempt income is received during relevant year

ACIT Vs Him Urja Pvt. Ltd. (ITAT Delhi)

ACIT Vs Him Urja Pvt. Ltd. (ITAT Delhi) The assessee has also submitted before the Ld. CIT(A) that as there was no exempt income earned by assessee during the relevant previous year, no disallowance under section 14A could be made. The assessee relied upon Judgment of the Hon’ble Delhi High Court in the case of […]...

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Section 43B not applicable on electricity duty collected on behalf of Government

Paschimanchal Vidhyut Vitran Nigam Ltd. Vs DCIT (ITAT Delhi)

Paschimanchal Vidhyut Vitran Nigam Ltd. Vs DCIT (ITAT Delhi) AO noticed that assessee had made assessment of electricity duty of Rs. 5,52,98,00,000/- of which Rs. 3,44,22,00,000/- was adjusted from the subsidy and the balance amount of Rs.2,08,76,00,000/-was not paid by the assessee before filing the return of income. Assessee was asked t...

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No Section 14A disallowance without Recording Proper Satisfaction

Indica Industries Pvt. Ltd. Vs ITO (ITAT Delhi)

The issue under consideration is whether the disallowance made by AO u/s 14A is justified in law? In view of the fact that no proper satisfaction was recorded, in our considered opinion, the Assessing Officer did not acquire any valid jurisdiction for computing disallowance u/s 14A....

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NRI expense for business purpose by non-resident bank allowable

Standard Chartered Grindlays Bank Vs ACIT (ITAT Delhi)

Standard Chartered Grindlays Bank Vs ACIT (ITAT Delhi) The assessee is a non-resident banking company which carries on the business of banking and other related activities through its branches in India in accordance with the provisions of Banking Regulation Act, 1949. During the year, Indian Permanent Establishment (in short PE) of the as...

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Provision for Mobile Phone Warranty Cannot be disallowed for mere Technology Improvement

Nokia India Pvt. Ltd. Vs Add. CIT (ITAT Delhi)

The issue under consideration is whether the CIT(A) is correct in disallowing the provision for warranty of mobile phone merely on the basis of improvement in technology is justified in law?...

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No cancellation of registration u/s 12AA(3) since inception in absence of cogent material

Gian Sagar Educational & Charitable Trust Vs ACIT (ITAT Delhi)

Order of the PCIT cancelling the registration since inception, u/s 12AA(3) was legally not valid as no material was being referred by PCIT and its applicability to any of the provisions of Section 2(15) and/or Section 12AA(3) while revoking the registration. ...

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Section 153C notice without recording Satisfaction Note is unjustified

ACIT Vs Rangoli Buildtech (P) Ltd. (ITAT Delhi)

The issue under consideration is whether the issuing notice u/s 153C to the person other than person against whom search is initiated, but without submitting satisfaction note is justified in law?...

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ITAT allows Deduction u/s 80HH, 80I & 80IA on Processed Natural Gas Supply

Gail (India) Ltd. Vs DCIT-LTU (ITAT Delhi)

The issue under consideration is whether the deduction claimed u/s 80HH, 80I and 80IA for production, processing, transmission and distribution of various gases is justified in law?...

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Income from Sale of Land held as Stock for 13 years is Business Income

Kohli Estates Pvt. Ltd. Vs ITO (ITAT Delhi)

The issue under consideration is whether the CIT(A) is correct in confirming an addition of by treating sale of land as business income against the appellant's claim as "Long Term Capital Gain"?...

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Section 40A(2)(b) Addition allowed against Expense only & Not against Income

KEC Delco Dutsan (JV) Vs ITO (ITAT Delhi)

The issue under consideration is whether the addition made u/s 40A(2)(b) in case of estimation of income without doubting expenses incurred by assessee is justified in law?...

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AMP expenditure do not constitute an international transaction

Bacardi India Pvt. Ltd. Vs ACIT (ITAT Delhi)

Bacardi India Pvt. Ltd. Vs ACIT (ITAT Delhi) Under Sections 92B to 92F, the pre-requisite for commencing the TP exercise is to show the existence of an international transaction. The next step is to determine the price of such transaction. The third step would be to determine the ALP by applying one of the five […]...

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Concern with extraordinary event cannot be comparable in year of amalgamation

American Express Services India Private Ltd. Vs DCIT (ITAT Delhi)

American Express Services India Private Ltd. Vs DCIT (ITAT Delhi) The assessee is aggrieved by the inclusion of the Accentia Technologies Ltd. in the final set of comparables. The plea of the assessee before us is that the said concern is engaged in diversified services which includes HRCM (using SaaS model), also is KPO and […]...

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Mere use of brand name or logo owned by AEs by assessee cannot be construed as expenses incurred for AMP

Xerox India Ltd. Vs DCIT (ITAT Delhi)

Expenditure incurred on Advertisement, Marketing and Promotion (AMP) for creating market intangibles including brand value in favour of Associated Enterprises was not  considered as an international transaction as mere use of brand name or logo owned by the AEs by assessee would not automatically lead to influence that any expenses that ...

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ITAT Restricted Addition made by AO to 2% of Bogus Purchases

Surana Enterprises Vs ITO (ITAT Delhi)

Surana Enterprises Vs ITO (ITAT Delhi) The issue under consideration is whether the addition made by AO u/s 69C by considering the purchases as Bogus Purchase is justified in law? ITAT states that, in present case, the assessee has shown sales of the goods, or otherwise the goods are lying in the closing stock. If […]...

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Section 50C Cannot be Invoked if No Reference Made to Valuation Officer

Razia Abu Khatri V. ITO (ITAT Delhi)

The issue under consideration is whether AO is correct in invoking section 50C where no reference to valuation officer despite being request made by assessee?...

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Explanation 7 to section 9(1)(i) of Income Tax Act is Retrospective

Augustus Capital Pte Ltd Vs DCIT (ITAT Delhi)

Assessing Officer was of the firm belief that operation of Explanation 7 to section 9(1)(i) of the Act is prospective, since it has been inserted by the Finance Act, 2015 and made effective from 01.04.2016 and, therefore, not applicable in the year under consideration....

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Duly recorded goodwill & customer contracts eligible for depreciation

DCIT  Vs Infrasoft Technologies Ltd (ITAT Delhi)

DCIT  Vs Infrasoft Technologies Ltd (ITAT Delhi) Undisputedly, during the year under assessment, the assessee has acquired certain business interest from M/s. KPIT Cummins Infosystems Ltd. for a consideration of Rs.19,02,00,000/- out of which an amount of Rs.6,52,80,577/- and Rs.10,89,60,000/- has been shown as goodwill and customer cont...

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Mitsui India Pvt. Ltd (MIPL) is not a DAPE of Mitsui & Co. Japan

ACIT Vs Mitsui & Co. Ltd. (ITAT Delhi)

ACIT Vs Mitsui & Co. Ltd. (ITAT Delhi) The AO asked the assessee to explain why Mitsui India Pvt. Ltd (MIPL) should not be treated Dependant Agent Permanent Establishment (DAPE) in India and also why the assessment should not be completed as per the preceding assessment year since the facts remain the same. Rejecting the […]...

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Income from product distribution taxable as ‘business income’ not ‘Royalty’

Turner Broadcasting System Asia Pacific Inc. Vs DDIT (ITAT Delhi)

Since distributor of the products did not have any right to change the content hence, the revenue derived on account of distribution of the products was business income and under no circumstance, could be held to be royalty. Assessee had already offered income as business income in terms of the MAP, therefore, the income as declared by as...

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No Tax on Interest accrued/ received by Indian PE from its HO/ overseas branches

MUFG Bank Ltd. Vs ACIT (International Taxation) (ITAT Delhi)

MUFG Bank Ltd. Vs ACIT (International Taxation) (ITAT Delhi) With respect to the addition on account of the interest received by Indian branches from head office and other overseas branches amounting to ₹ 3,499,476/–. During the year , assessee has received an interest of ₹ 3,499,476 from its head office and overseas branches. The a...

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Appellate Authorities can accept Additional Claim under Section 54

Smt. Monika Jain Vs ITO (ITAT Delhi)

Smt. Monika Jain Vs ITO (ITAT Delhi) The issue under consideration is whether the additional claim (section 54 exemption Claim) will be allowed to be presented in front of appellate authorities? ITAT states that, the Assessing Officer has been barred from accepting any new claims, but no such bar has been imposed on the appellate [&hellip...

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Income from bandwidth services provided outside India cannot be taxed as ‘Royalty’ under India-Singapore DTAA

Telstra Singapore Pte. Ltd. Vs DCIT (International Taxation) (ITAT Delhi)

Income received on providing bandwidth services outside India was not taxable as ‘Royalty’ under India-Singapore Double Taxation Avoidance Agreement (DTAA) as mere receipt of service using equipment under the control, possession and operation of service provider would only be considered as transaction of a service and not to 'use or r...

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Section 50C not applicable to leasehold rights

Noida Cyber Park Pvt. Ltd. Vs ITO (ITAT Delhi)

Noida Cyber Park Pvt. Ltd. Vs ITO (ITAT Delhi) Section 50C(1) of the Act, in so far as it is relevant for our purpose, prescribes that where the sale consideration received or accruing as a result of the transfer by an assessee of a capital asset, being ‘land or building or both‘, is less than […]...

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Payment for international freight logistic support services & Global Account Management expenses cannot be treated as technical services fee

ACIT Vs Expeditors International of Washington (ITAT Delhi)

Amount paid for international freight logistic support services and Global Account Management (GAM) expenses by assessee-foreign company to Indian company could not be treated as Technical Services or Fee for Included Services (FIS) and also could not be taxed under section 9(1)(i) as no income had accrued or arised from the business conn...

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ITAT disallows provision for professional Cost for inconsistent accounting policies

Bain & Company India Private Ltd. Vs DCIT (ITAT Delhi)

Bain & Company India Private Ltd. Vs DCIT (ITAT Delhi) We find the AO in the instant case disallowed the provision of professional cost amounting to Rs. 94,97,000/- debited to the profit and loss account on the ground that the assessee could not substantiate the basis for making the said provision. There was no invoice […]...

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TDS not deductible on Trade Offers Provided to Distributors

Nokia India Pvt. Ltd Vs Acit (ITAT Delhi)

Assessee made the detailed submissions inter alia contending that the provision of section 194H, 194C, 194J were not applicable to the case because the payment was not for any contractor of services or work, there was no relationship of agency....

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Penalty justified for failure to maintain Transfer Pricing Documents

DCIT Vs Convergys Customer Management Group Inc. (ITAT Delhi)

DCIT Vs Convergys Customer Management Group Inc. (ITAT Delhi) It is mandatory for all taxpayers, without exception, to obtain an independent accountant’s report in respect of all international transactions between associated enterprises or specified domestic transactions. The report has to be furnished by the due date of the tax ret...

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Insurance Companies- Section 14A disallowance unjustified

Oriental Insurance Co. Ltd. Vs DCIT (ITAT Delhi)

Oriental Insurance Co. Ltd. Vs DCIT (ITAT Delhi) The Tribunal has interpreted Section 44 read with the first schedule and concluded that applicability of Section 14A is excluded in relation to computation of income of an insurance company. We have examined the relevant provisions. Section 44 begins with a non-obstante clause and overrides...

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Government concerns are not comparable as they do not have profit motive

Intercontinental Hotels Group (India) Pvt. Ltd. Vs DCIT (ITAT Delhi)

Intercontinental Hotels Group (India) Pvt. Ltd. Vs DCIT (ITAT Delhi) Hon’ble High Court in Philip Morris had directed that M/s. Apitco Ltd. was not good comparable of concerns providing business support services, on the ground that in case of Government enterprises, profit motive is not relevant consideration and the Government company ...

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In absence of any defect DCF valuation method of Assessee cannot be rejected

Intelligrape Software Pvt. Ltd. Vs ITO (ITAT Delhi)

Intelligrape Software Pvt. Ltd. Vs ITO (ITAT Delhi) When the assessee Company had opted for valuation of unquoted equity shares in accordance with DCF method as prescribed under clause (b) of specific Rule 11UA(2) as applicable, the AO/CIT(A) had no power/authority to change such valuation methodology and adopt a different book value meth...

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ITAT upheld TP adjustment for outstanding debtors beyond agreed period

Bharti Airtel Services Ltd. Vs DCIT (ITAT Delhi)

Bharti Airtel Services Ltd. Vs DCIT (ITAT Delhi) In the present case the service agreement clearly says that the amount of payment is to be made by the associated enterprises to the assessee within 15 days. Such payment was not made within that period but beyond that. The learned assessing officer held that the amount […]...

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Section 14A disallowance not sustainable if proper satisfaction not recorded

Vinay Bhasin Vs. ACIT (ITAT Delhi)

Vinay Bhasin Vs ACIT (ITAT Delhi) Assessee made heavy investments for earning of exempt income and being a busy professional, he requires the management of such a portfolio by incurring expenses, diversion of man-power/staff for indulging in investment activities to various activities like visiting banks, use of vehicle and telephone, use...

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Tax rates specified in DTAA in respect of dividend must prevail over DDT

Giesecke & Devrient [India] Pvt Ltd. Vs Add. CIT (ITAT Delhi)

Giesecke & Devrient [India] Pvt Ltd. Vs ACIT (ITAT Delhi) To recapitulate, the DDT is levy on the dividend distributed by the payer company, being an additional tax is covered by the definition of ‘Tax’ as defined u/s 2(43) of the Act which is covered by the charging section 4 of the Act and charging […]...

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Depreciation eligible on goodwill recorded pursuant to a business transfer agreement

DCIT Vs Ebix Software India Pvt. Ltd. (ITAT Delhi)

DCIT Vs Ebix Software India Pvt. Ltd. (ITAT Delhi) The Assessing Officer has held that the cost of the purchase consideration over the tangible assets is to be treated as payment for the non-compete fees as there was no goodwill with the seller and creation of the goodwill is misleading. The aforesaid finding is based […]...

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Funds raised by FCCB Buy Back at Discounting Rate is Not Business Income

Ok Play India Ltd. Vs JCIT (ITAT Delhi)

The issue under consideration is whether the funds raised from buy back of FCCB at discounting rate is  considered as business income and tax u/s 28 of the Income Tax Act?...

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Activities promoting Handloom Sector Eligible for section 11 & 12 Exemption

ITO (E) Vs Association of Corporation & Apex Societies of Handlooms (ITAT Delhi)

The issue under consideration is whether the activities involved towards promotion of handloom sector is eligible for exemption under section 11 and 12 of Income Tax Act?...

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Section 80IAB Deduction allowable to DLF on profit & gains from SEZ development

DLF Ltd. Vs. JCIT (ITAT Delhi)

DLF Ltd. Vs. JCIT (ITAT Delhi) Conclusion: Deduction of Rs. 1.78 Billion in respect of profits derived on account of development considerations of bare shells would constitute profits and gains derived from business of developing any Special Economic Zone within the meaning of Section 80 IAB and was allowable to DLF Limited. Held: Assesse...

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No Tax on transfer of property under family settlement

Govind Kumar Khemka Vs ACIT (ITAT Delhi)

In this case, since there was a Family Settlement between the assessee and three brothers and they have acted upon Family Settlement Deed and distributed various properties among themselves and necessary rights and title are transferred in favour of each brother would show that parties have entered into genuine transaction....

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Unexplained jewellery: ITAT allows credit for 100 gms of jewellery to son of assessee

Parag Gupta Vs DCIT (ITAT Delhi)

Parag Gupta Vs DCIT (ITAT Delhi) The issue in the present ground is with respect to addition of Rs. 2,70,000/- on account of unexplained jewellery. It is the contention of the learned AR that if the correct quantity of jewellary (i.e. 671.53 gms is considered instead of 771.83 gms) and if the credit for jewellery […]...

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Benchmarking of cost to cost reimbursement of expenses was not within TPO jurisdiction

Danisco India Pvt. Ltd. Vs DCIT (ITAT Delhi)

Benchmarking of cost to cost reimbursement of expenses was not within the jurisdiction of the TPO while computing the arm's length price of the international transaction u/s 92CA of the Act....

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ALP of higher AMP expenditure cannot be determined without first establishing that it is an international transaction

Yakult Danone India Pvt. Ltd. Vs DCIT (ITAT Delhi)

Approach of the learned transfer pricing officer of determining ALP of international transaction of incurring of higher AMP expenditure cannot be benchmarked either on Bright line test bases or on transactional net margin method unless first it is established that there existed an international transaction. Accordingly all the grounds of ...

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Serving of Notice on Wrong Address is as good as Not Issuing Notice to Assessee

ITO Vs Ajay Raj (ITAT Delhi)

ITO Vs Ajay Raj (ITAT Delhi) The issue under consideration is whether the notice u/s 143(2) served on wrong address is sustainable in law? ITAT states that, the notice u/s 143(2) of the Act was issued to the address at “85, Kumharon Wali Gali, Village Khampur, Delhi” which was not served on the assessee whereas […]...

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Expense can be disallowed u/s 40A(2)(b) & Not the Receipts

KEC-PLR-KPIPL-JV Vs ITO ( ITAT Delhi)

ITAT states that, in the present case, it is an admitted position that the AO made the addition by invoking the provisions of Section 40A(2)(b) of the Act which are applicable to the expenses considered to be excessive or unreasonable having regard to the fair market value of the goods/services or facilities for which the payment is made....

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Royalty expense allowable when goods are sold to Associated Enterprise on principal-to-principal basis

Honda Motorcycle and Scooters India Pvt. Ltd. Vs DCIT (ITAT Delhi)

The assessee has sold the goods to the Associated Enterprise on principal to principal basis and has received sales consideration. The royalty is payable on the basis of the goods manufactured. Accordingly, addition made by the AO/TPO by determining the arms’ length price of royalty on exports to the Associated enterprise at ‘NIL’ i...

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No reopening of Assessment for mere client code modification

Stratagem Portfolio (P.) Ltd. Vs DCIT (ITAT Delhi)

Since there was no material to infer that client code modification had been done by assessee with malafide purpose of shifting of the profit or evasion of the tax hence, assessment could not be reopened under section 147 in absence of any tangible material to infer that income escaped in the case of assessee....

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Exemption u/s 11 & 12 was allowable to Association of State Road Transport Undertaking

DCIT Vs. Association of State Road Transport Undertaking (ITAT Delhi)

Since assessee association was providing laboratory test services and consultancy services in accordance with its charitable objects, therefore, activities could not be held to be rendered in relation to any trade, commerce or business as such activities were undertaken by assessee association in furtherance of its main objects which wer...

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Section 195 TDS not deductible on management fees paid to France entity

Steria (India) Ltd. Vs. ACIT (ITAT Delhi)

Steria (India) Ltd. Vs. ACIT (ITAT Delhi) Ground number 11 is with respect to the disallowance of management services fees for non-deduction of tax u/s 40 (a) (i) of the act amounting to ₹ 206,044,024 incurred on account of management services fees, held to be fees for technical services on which tax deduction at source […]...

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Payments to church, police station, summits, schools, etc are not CSR expense

Vedanta Ltd. Vs ACIT (ITAT Delhi)

Vedanta Ltd. Vs ACIT (ITAT Delhi) At the very outside, the Tribunal in the case of National Small Industries Corporation Limited 175 ITD 601 has held that amendments made to section 37 of the Act vide Finance Act [No. 2] 2014 are prospective in nature and hence would not be applicable to the period prior […]...

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Reopening not justified when all aspects were examined in original assessment proceedings

Nishit Fincap Pvt Ltd. Vs ITO (ITAT Delhi)

Nishit Fincap Pvt Ltd. Vs ITO (ITAT Delhi) Query No. 7 is in relation to share capital and share application money received. This means that specific query was raised in respect of share application money and vide reply dated 16.11.2009, the assessee furnished all details as required by the Assessing Officer. Pursuant to the reply [&helli...

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MIPL is not a Dependent Agency Permanent Establishment of Mitsui & Co.

Mitsui & Co. Ltd. Vs DDIT (International Taxation) (ITAT Delhi)

Mitsui & Co. Ltd. Vs DDIT (International Taxation) (ITAT Delhi) Since the lower authorities following the orders of the preceding years have held that M/s. Mitsui & Co. Ltd. has been constituted as Dependent Agent PE of the assessee company in India, therefore, following the consistent decisions of the Tribunal in assessee’s own...

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Purchase credited in books cannot be added under section 68

Sanjay Sharma Vs. ACIT (ITAT Delhi)

Sanjay Sharma Vs. ACIT (ITAT Delhi) Assessing Officer has accepted not only he sales figures but has also accepted that total purchases. Under accounting principles, a liability can only be brought into account by a credit entry in the books of account in favour of the person to whom the money is payable’ Thus, there […]...

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Deduction of cess allowable as same is not covered under section 40(a)(ii)

Midland Credit Management India Pvt. Ltd. Vs Addl. CIT (ITAT Delhi)

Midland Credit Management India Pvt. Ltd. Vs Addl. CIT (ITAT Delhi) Assessee by way of additional ground has claimed deduction of cess on the ground that the same is not covered under section 40(a)(ii) of the Act. The Hon’ble High Court of Bombay at Panaji bench in the case of Sesa Goa 423 ITR 426 […]...

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Interest on Borrowing invested in Shares of Subsidiary Companies in same line of business allowable

ACB [India] Power Ltd Vs DCIT (ITAT Delhi)

ACB [India] Power Ltd. Vs DCIT (ITAT Delhi) Assessing Officer observed that the borrowings of the assessee also has been invested in share capital of subsidiary companies and even the funds raised during the year under consideration have been invested in subsidiary shares of group companies and also repaying the loans. The Assessing Offic...

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Bright line test not appropriate for benchmarking AMP expenses

Haier Appliances India Pvt. Ltd. Vs. DCIT (ITAT Delhi)

Haier Appliances India Pvt. Ltd. Vs. DCIT (ITAT Delhi) This is not disputed by the Revenue as the TPO in order dated 21.10.2011 considered Vivek Limited as appropriate comparable for benchmarking AMP expenses, applying Bright Line Test. The TPO considered Vivek Limited as comparable as it is trader/re-seller of home appliances and does no...

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Forfeited Security deposit given for lease allowable as Business Loss

DCIT Vs Ebony Retail Holdings Ltd. (ITAT Delhi)

DCIT Vs Ebony Retail Holdings Ltd. (Delhi ITAT) It is not in dispute that assessee has given security deposit for taking the premises on lease. Learned Counsel for the Assessee referred to various replies filed by assessee-company at assessment stage which shows that assessee-company filed all the documentary evidences and explanation bef...

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Protective adjustment- ITAT directs AO to decide in the light of MAP resolution

BT Global Communications India Pvt. Ltd.  Vs. Addl. CIT (Delhi ITAT)

BT Global Communications India Pvt. Ltd.  Vs. Addl. CIT   (Delhi ITAT) The only issue to be decided in the present appeal relates to protective adjustment on account of business restructuring that has taken place in assessment year 2010-11. We find that TPO/DRP have made adjustment on substantive basis in assessment year 2010-11. Howeve...

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Depreciation cannot be disallowed for temporary closure of Business

Ishwar Builders Pvt. Ltd Vs DCIT (ITAT Delhi)

The issue under consideration is whether disallowance of depreciation on car and interest on car loan by AO is justified in law?...

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ITAT Allowed Exemption not claimed in ITR filed due to Inadvertence

Max Life Insurance Company Ltd. Vs ACIT (ITAT Delhi)

whether the additional ground submitted by the assessee should be allowed by the tribunal by considering that the assessee has not claimed exemption in the return filed due to inadvertence?...

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Resultant Company cannot claim Demerger Expenses U/s. 35DD

ACIT Vs. NIIT Technologies Ltd. (ITAT Delhi)

The issue under consideration is whether the deduction u/s 35DD for demerger expenses is allowed to be claimed by resultant demerged company?...

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Disallowance of Expenditure u/s 14A by AO without Recording a Satisfaction is Not Justified

Shri Vinay Bhasin Vs. ACIT (Delhi ITAT)

The issue under consideration is whether the disallowance of expenditure u/s 14A by AO without recording a satisfaction is justified in law?...

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Interest Paid on Security Deposit obtained from Members of Society is allowed u/s 57(iii)

Belvedere Tower Condominium Association Vs. ITO (ITAT Delhi)

The issue under consideration is whether the Interest paid on security deposit obtained from the members of society is allowed as expense u/s 57(iii) of the Act?...

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No additions on issues not part of limited scrutiny: ITAT Delhi

Atul Gupta Vs ACIT (ITAT Delhi)

Atul Gupta Vs ACIT (ITAT Delhi) It is an undisputed fact that the instant case was picked up for ‘Limited Scrutiny’ on two specific issues as reproduced in Para 2.0 above. It is also an undisputed fact that neither any permission was sought by the AO to expand the scope of limited scrutiny in the […]...

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Outstanding Receivables are Part of Working Capital Hence No Separate Benchmarking Required for them

DCIT (LTU) Vs EXL Service.com (India) Pvt. Ltd. (ITAT Delhi)

The issue under consideration is whether the addition made on imputing interest on outstanding receivable from associated enterprises as its separate international transaction and its determination of ALP is justified in law?...

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Section 91: Assessee entitled to foreign tax credit of federal as well as state taxes

Aditya Khanna Vs DDIT (ITAT Delhi)

Aditya Khanna Vs DDIT (ITAT Delhi) The Income-tax in relation to any country includes Income-tax paid in any part of the country or a local authority. It applies to cases where in a federal structure a citizen is made to pay federal Income-tax and also the State income tax. The Income-tax in relation to any […]...

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No addition can be made merely on the basis of presumption

Sindhu Trade Links Ltd. Vs Add. CIT (ITAT Delhi)

Sindhu Trade Links Ltd. Vs DCIT (ITAT Delhi) It can be seen that the assessee company had purchased land at Tifra Bilaspur for Rs. 55,44,800/- including stamp duty and registration charges of Rs. 7,06,705/-. The Ld. DR submitted that as per the observations of the Assessing Officer there are certain purchases of land /properties where [&h...

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No adjustment for notional interest on receivables if taxpayer is debt free

Global Logic India Ltd Vs DCIT (ITAT Delhi)

Global Logic India Ltd Vs DCIT (ITAT Delhi) No adjustment is to be made on account of notional interest on receivables by relying upon Explanation (i), (a) & (c) of section 92B by treating the continued debt balance as an international transaction. Moreover when the taxpayer is debt free company, there is no question of […]...

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Legality of Additions/ denial of TDS Credit u/s 143(1) through non speaking order

AWP Assistance (India) Pvt. Ltd Vs DCIT (ITAT Delhi)

ITAT has noted that intimation u/s 143(1) does not contain reasons for denial of TDS credit and it is nothing, but information generated in pro forma by CPC. ITAT has made observation that Intimation not only does not provide reasons but also it does not appear to be result of due examination of the issue by AO....

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No section 68 addition if Assessee Proves Identity, Creditworthiness & Genuineness

Nimbus (India) Ltd. Vs DCIT (ITAT Delhi)

The issue under consideration is whether the addition made by the AO under section 68 by considering the the amount received as unexplained share capital and premium is justified?...

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ITAT explains section 244A provisions – Interest on Income Tax Refund

Maruti Suzuki India Ltd Vs CIT (Appeals) (ITAT Delhi)

Maruti Suzuki India Ltd Vs CIT (Appeals) (ITAT Delhi) The Honorable Delhi ITAT recently adjudicated an appeal filed in the case of Maruti Suzuki India Ltd vs Commissioner of Income Tax (Appeals)-IX (ITA No. 2553, 2641/Del/2013) wherein the case before the Tribunal was related to the provisions of section 244A of the Income Tax Act. Post ...

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Six AYs Counted from Date of Handing over of Assets/Documents to AO for Section 153C Assessments

ACIT Vs Mapsa Tapes (P) Ltd. (ITAT Delhi)

whether Assessment year in respect of proceedings u/s 153C of the Act to be same 6 years in the case of other person, for which the proceedings u/s 153A is initiated in the case of connected searched person?...

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Section 153C Assessment order in the Name of Non Existing Entity is Invalid

DCIT Vs Mapsa Infra (P) Ltd. (ITAT Delhi)

The issue under consideration is whether Assessemnt order u/s 153C issued in the name of Amalgamated Company will be considered as valid?...

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