The Tribunal confirmed that no disallowance under Section 14A can be made when the assessee earned no exempt income during the year. Following Calcutta High Court precedents, the ITAT rejected the Revenue’s attempt to apply the prospective Finance Act 2022 amendment to the relevant assessment year (AY 2014-15).
The ITAT ruled that loss from trading in foreign currency derivatives on a recognized exchange is non-speculative business loss, eligible for set-off under Section 43(5)(d). The Tribunal held that such transactions are covered by the exception for derivatives and rejected the lower authorities’ mechanical disallowance.
The ITAT invalidated an assessment due to two fundamental defects: the 143(2) notice was invalid as it failed to specify the type of scrutiny (Limited/ Complete) per CBDT instructions, and the assessment was completed by the ACIT, who lacked pecuniary jurisdiction over the Rs.10.41 Lakh income case. The ruling stresses that procedural compliance with binding CBDT instructions is mandatory, or the entire assessment becomes void.
This decision emphasizes that violation of binding CBDT instructions, such as failing to specify the category of scrutiny in the Sec. 143(2) notice, strikes at the root of the assessment. The Kolkata Tribunal quashed the entire Sec. 143(3) assessment as being without jurisdiction, affirming that legal grounds can be raised at any stage.
The ITAT Kolkata quashed a search assessment (Sec. 153A) because a search was never physically conducted on the assessee’s premises, ruling that a mere mention in a panchnama is insufficient to confer jurisdiction. The key takeaway is that an assessment under Sec. 153A is void ab initio if an actual search on the person or property of the assessee is not initiated and conducted.
The Kolkata ITAT allowed Winner Tradecom Pvt. Limited’s appeal, deleting a ₹15 lakh addition made under Section 68 for an alleged credit from a shell company.
ITAT Kolkata held that issuance of reassessment notice under section 148 of the Income Tax Act expiry of specified period of limitation is time barred and hence invalid and bad-in-law. Accordingly, appeal of assessee is allowed and notice is quashed.
ITAT Kolkata held that passing of reassessment order without issuing any notice under section 143(2) of the Income Tax Act is bad in law and not jurisdictional. Accordingly, order quashed and addition is deleted.
ITAT Kolkata held that mere non-filing of income tax returns by suppliers or non-response to notices cannot make an assessee’s expenses bogus. Proper verification of invoices, ledgers, payments, and work done is mandatory before disallowing purchases or subcontract expenses.
The ITAT remanded the assessment for an individuals commission income, ruling that the Assessing Officer (AO) must first verify if the income was already offered to tax by the company of which the assessee was a Director. The key takeaway is the prohibition of double taxation on the same income, directing the AO to delete the addition if the company has paid the tax.
