The Tribunal directed the AO to treat the sales tax subsidy as a capital receipt, finding its purpose was to promote industrialization in backward regions, not subsidize production. The ITAT also deleted the Section 14A disallowance, confirming the taxpayer had sufficient own funds.
The Income Tax Appellate Tribunal (ITAT), Delhi, allowed a retired individual’s appeal, deleting an addition of made under Section 69A of the Income Tax Act, 1961
The ITAT deleted transfer pricing adjustments for Advertisement, Marketing, and Sales Promotion (AMP) expenses, confirming no international transaction existed with the AE. The ruling held that the Bright Line Test (BLT) is invalid and that since the entity-level TNMM was accepted, no separate AMP adjustment was permissible.
The ITAT ruled that the Rs. 5.97 crore received by a charitable trust for a cultural event were tax-exempt donations, not business income hit by Section 2(15) proviso. The Tribunal held that TDS deduction or invoice issuance does not change the essential charitable character of the receipt, relying on a binding Delhi High Court judgment.
The ITAT quashed the entire assessment order, ruling that the DCIT (Exemption), Ghaziabad, lacked jurisdiction to pass the order since no mandatory Section 127 transfer order was produced. The Tribunal held that without a valid transfer order from the original AO, the assessment is illegal, arbitrary, and void ab initio.
The Tribunal held that a ₹15.22 crore one-time payment to distributors, necessitated by a business model shift, was a valid revenue expenditure under Section 37, driven by commercial necessity. The ruling affirms that business prudence justifies compensation to maintain continuity without creating a capital asset.
Delhi ITAT grants relief to Park View Automotive, deleting a ₹5.59 Cr. addition on share sale. The Tribunal held that an AO cannot arbitrarily substitute a genuine bulk sale price based merely on an Investigation Wing report or suspicion, emphasizing that concrete documentary evidence must be rebutted.
The Tribunal voided the reassessment, citing multiple legal failures: it was time-barred under the new law, the AO failed to share mandatory material, and the condition under Section 149(1)(b) requiring a proven asset/expenditure was not met. The ruling provides strong takeaways on the validity of new reassessment provisions.
ITAT Delhi rules in Mahabir vs ITO that the 1994 CBDT notification defines agricultural land limits for capital gains tax. Subsequent municipal expansions are irrelevant. Land 6km from Sohna Municipality was deemed non-taxable.
The Tribunal nullified four assessment years (AY 2013-14, 2014-15, 2018-19, 2021-22) due to serious legal defects, including unsigned/mechanical approvals and non-supply of mandatory sanction and underlying material. This ruling emphasizes that defective procedure is fatal to both reopening and regular assessment proceedings.
