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2017 (7) TMI 1444
Deduction u/s 80IA(4) - conditions of IPS-2008 were not fulfilled by the assessee - assessee's project was not notified by the Govt. for claim of deduction u/s 80IA(4) for the A.Y. under consideration - HELD THAT:- We are making reliance on the said decision of Tribunal in assessee’s own case [2016 (8) TMI 1586 - ITAT PUNE] and M/s. Kolte Patil Developers [2015 (3) TMI 363 - ITAT PUNE] we uphold the order of CIT(A) in allowing the claim of deduction under section 80IA(4)(iii). Deduction u/s 80IB(10) in respect of Kumar Puram project - Tribunal had noted the said issue as already decided the issue in assessment year 2001-02 and relying on the same held the issue to be identical and allowed the claim of assessee. AO in the present case has also disallowed the claim of assessee under section 80IB(10) of the Act in respect of Kumar ....... + More
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2017 (7) TMI 1442
Income deemed to accrue or arise in India - Business profit attributable to the PE of the assessee in India - Royalty received by the assessee from Warner Bros Picture India Ltd in pursuance to the agreement for distribution and exhibition of the films in India - Whether Respondent does not have PE in India because the Indian company that has obtained the right is acting independently - HELD THAT:- As decided in assessee own case [2016 (10) TMI 1372 - ITAT MUMBAI] very issue of existence of PE in India has been considered by the Hon‟ble ITAT. The income of the assessee company does not qualify for the definition of Royalty in term of income tax Act 1961. The AO himself has accepted in the assessment order that the income of the assessee cannot be taxed as Royalty. Once the income of the assessee company does not qualify under the de....... + More
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2017 (7) TMI 1438
TP Adjustment - comparable selection - HELD THAT:- Assessee company is engaged in the business of export of information technology enabled services, thus companies functinally dissimilar with that of assessee need to be deselected. DRP excluded comparables, Viz., (a) Informed Technologies Ltd (b) Microgenetics Ltd (c) Cosmic Global Ltd. - The finding of DRP that Cosmic Global Ltd. has sub-contracted the ITES Services to the extent of 41% whereas assessee has not dealt with any of the sub-contract work of its ITES services and hence it cannot be compared with the assessee. With regard to Informed Technologies, DRP has noticed that sales and services income is only Rs. 1.75 crores to that of gross revenue of Rs. 4.08 crores of the company which fails the services revenue filter of 75% applied by the TPO. With regard to Microgenetics, the DR....... + More
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2017 (7) TMI 1435
Nature of expenses - Expenses relates to application of software packages - revenue or capital expenditure - HELD THAT:- We find that this issue has been settled by Tribunal in all the earlier years and factually the expenses relates to application of software packages which get frequently outdated and have to be replaced. The expenditure is to be treated as Revenue in nature and we allow the same accordingly. Disallowing the expenses of foreign travel - HELD THAT:- Tribunal in AY 1995-96 in [2013 (10) TMI 1039 - ITAT MUMBAI] allowed the claim of the assessee. Deduction u/s 80HHC - holding that 90% of the net amount is machinery higher charges which required to be deducted from eligible profit for deduction under section 80HHC in term of explanation(baa) to section 80HHC - HELD THAT:- Hon’ble Bombay High Court in the case of CIT vs........ + More
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2017 (7) TMI 1432
Revision u/s 263 by CIT - Deduction u/s 80IB(10) - HELD THAT:- There is a specific reference to the examination by the AO of deduction u/s 80IB(10) - Conclusion of CIT therefore that the AO failed to make proper enquiries before concluding the assessment, cannot be sustained. We are also of the view that the non issuance of notice u/s 133(6) in respect of advance received from the customers or not making any enquiries thereon by itself cannot be the basis to say that there was a failure on the part of AO to make proper and necessary enquiries. A reading of notice issued u/s 142(1) by the AO before completing assessment u/s 143(3) of the Act and the details furnished by the assessee in response to this notice clearly shows that the AO was fully conscious of the details of advance received from the customers furnished by the assessee. There....... + More
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2017 (7) TMI 1431
Bogus purchases - Addition of hawala purchases - HELD THAT:- In the facts of the case, the assessee had tried to meet the case of AO and hence, the onus shifted upon the AO to disprove the claim of assessee. AO has failed to discharge the onus in this regard. AO has failed to complete the investigation in the case. In view of the affidavits / confirmation letters filed by the assessee, no further enquiries were made in the present set of facts. In the absence of the same and where the assessee has tried to built upon its case and has also shown the trail of goods i.e. as against the booking of sales, it had made the purchases and in this regard has complete quantitative records available with him, then the onus cast upon the assessee stands discharged once the same is produced before the authorities below. Where the assessee has discharge....... + More
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2017 (7) TMI 1430
Penalty u/s 271(1)(c) - Income of the assessee was finally estimated by the Ld. AO @2% of total receipts as per the Bank statements which was confirmed by the Ld. CIT(A) - HELD THAT:- As decision of Tribunal rendered in associated concern of the group Jayesh K. Sampat [2016 (10) TMI 1127 - ITAT MUMBAI] where the Tribunal on identical set of facts and similar submissions / contentions has remitted the matter back to the file of AO for fresh adjudication in terms of respective submissions. Both representatives have agreed for similar directions in the present case. Thus as facts of the instant case are identical in all respect and submissions of the representatives are also identical. Therefore, on similar lines, the matter is restored back to the file of Ld. Assessing Officer for fresh adjudication, which results into assessee’s quantum appeals being partly allowed for statistical purposes.
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2017 (7) TMI 1418
Interest due on ‘Non-Performing Assets’ - CIT deleting the addition made by the AO holding that the interest due on ‘Non-Performing Assets’ was taxable as the Co-op Bank was following mercantile system of Accounting except with regard to the interest pertaining to NPAs - HELD THAT:- As per CIT it is to taxed in the year of actual receipt even though it is following mercantile system of Accounting.at the assessee is a Co-operative Society which is engaged in the business of banking and has been following the directions of the Apex Bank and according to that interest due on NPAs had to be accounted for as income on actual receipts basis. Even otherwise, AS9 of ICAI on Revenue recognitions provide for, where there in uncertainty about the collection of Revenue, recognition of income or such Revenue is postponed to the....... + More
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2017 (7) TMI 1417
Exemption claimed u/s 80-P with regard to the interest income earned on fixed deposit with State Bank of India - CIT(A) noticed that the decision of the Mumbai Bench of Tribunal in the case of M/s. Jaoli Taluka Sahakari Patpedhi Maryadit [2015 (9) TMI 170 - ITAT MUMBAI] fully covered the controversy in favour of the assessee - HELD THAT:- At the time of hearing, the ld. DR reiterated the stand of the Assessing Officer, but quite fairly pointed out that the CIT(A) has followed the decision of the Mumbai Bench of the Tribunal in the case of M/s. Jaoli Taluka Sahakari Patpedhi Maryadit (supra), which continues to hold the field. In view of the aforesaid fact-situation, we find no reasons to interfere with the decision of the CIT(A), which we hereby affirm. Thus, appeal of the Revenue is dismissed.
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2017 (7) TMI 1416
Addition invoking the provisions of Section 41 being the amount received for installation of wind energy generators - HELD THAT:- If the assessee had declared the amount of ₹ 1 crore as its income, for the assessment year 2014-15 then obviously making addition once again in the hands of the assessee for the relevant assessment year 2010-11 would amount to double taxation. Further due to the various commercial relationships between the assessee and its clients, the assessee had treated the amount of ₹ 1 crore as its liability in the relevant assessment year, by not invoking the penalty clause in the agreement executed between them, thereby providing an opportunity to its client to comply with the terms and conditions of the agreement and hence the assessee had not appropriated the advance. Only during the assessment year 2014-1....... + More
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2017 (7) TMI 1415
Assessment u/s 153A - search conducted u/s 132 on the premises of the assessee - Whether no incriminating material was found during the course of search? - HELD THAT:- In the present case, admittedly, no assessment under section 143(3) of the Act was completed and moreover, even though no incriminating materials were found during the course of search, the decisions relied on by the ld. CIT(A) are not applicable. See DR. P. SASIKUMAR [2016 (7) TMI 1227 - KERALA HIGH COURT] wherein held even if no documents are unearthed or any statement made by the assessee during the course of search under section 132 and no materials are received for the afore specified period of six years, the assessee is bound to file a return, is the scheme of the pro vision. Even though the second proviso to section 153A speaks of abatement of assessment or reassessm....... + More
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2017 (7) TMI 1408
Reopening of assessment u/s 147 - disallow the set off of unabsorbed depreciation claimed from 1998-99 onwards - no business was carried on by the assessee for the AY 1999-2000 to AY 2009-10 and therefore, the unabsorbed depreciation for the above said period could not be carried forward and set off for future years - Whether claim of depreciation is allowable for both “active” and “passive” use of the asset including an asset that is in ready-for-use condition? - HELD THAT:- The factual finding of the CIT(A) that the asset in question was not kept ready for use condition and there was no passive use of the same for the assessment years 1999-2000 to 2009-10, has not been dispelled by the assessee by placing any contrary evidence before the Tribunal. Therefore,we confirm the order of the CIT(A). Assessee’s con....... + More
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2017 (7) TMI 1407
Disallowance of set off of unabsorbed depreciation pertaining to the earlier year - HELD THAT:- Hon’ble Gujarat High Court in the case of General Motor (India) Pvt. Ltd. [2012 (8) TMI 714 - GUJARAT HIGH COURT] as held that after the amendment made vide the Finance Act, 2001, the balance of unabsorbed depreciation revived back into life and became eligible for carry forward and set off along with other parts of unabsorbed depreciation available to the credit of the assessee. This issue is thus squarely thus covered in favour of the assessee by the said decision of Hon’ble Gujarat High Court and in the absence of any contrary decision, brought to our notice that the learned DR which is in favour of the revenue on this issue, we respectfully follow the same and uphold the impugned order of the Ld. CIT(A) allowing the claim of the....... + More
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2017 (7) TMI 1406
TP Adjustment - Provision of software development services - comparable selection - HELD THAT:- Companies functionally dissimilar with that of assessee need to be deselected. Deduction allowable u/s. 10A after reducing the telecommunication charges and expenses incurred for travel in foreign currency both from the export turnover as well as the total turnover - HELD THAT:- We find that the CIT (A) holding that the expenses excluded from the export turnover should also be excluded from the total turnover for computation of deduction u/s. 10A of the Act. We find that this issue is also covered by the decision of the jurisdictional High Court in the case of Tata Elxsi Ltd. [2011 (8) TMI 782 - KARNATAKA HIGH COURT]. In view of the same, we see no merit in the appeal of the revenue and the same is dismissed.
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2017 (7) TMI 1402
Revision u/s 263 - interest u/s 244A in relation to taxation of interest on securities - allowance of interest u/s 244A allowed in the order of rectification u/s 154 by the AO as excessive for the reason that the assessee included the amount of interest on securities on accrual basis and paid self assessment tax thereon, though claimed by way of a note accompanying the return of income the said income as not taxable in that year as it has not become due - HELD THAT:- As in THE STOCK HOLDING CORPORATION OF INDIA LTD. [2014 (11) TMI 899 - BOMBAY HIGH COURT] held that tax paid on self assessment would fall u/s 244A (1) (b), i.e. a residuary clause covering refunds of amount not falling u/s 244A (1), therefore, interest is payable on refund on excess amount paid on self assessment tax. We are of the considered view that the issues in the inst....... + More
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2017 (7) TMI 1400
Estimation of income on bogus purchases - Addition on the basis of surmises and presumption - AO after rejecting the books of accounts applied 12.5% as profit on purchases - HELD THAT:- Application of GP 12.5% on the bogus purchases is reasonable but the GP declared by the assessee in the books of account should be reduced from the said percentage and only the differential should be applied - the rate as applied by the AO i.e 12.50% minus already declared in the profit and loss account i.e 9.38 % which comes to 3.12% should be applied. Accordingly, we set aside the order of ld.CIT(A) and direct the assessing officer to apply GP rate 3.12% on the bogus purchases to cover the various types of savings such as saving on account of VAT and other incidental charges. Resultantly, the appeal of the assessee stands partly allowed.
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2017 (7) TMI 1396
Validity of order passed by JCIT u/s.144A - limited scrutiny or complete scrutiny - proceedings converted into a complete scrutiny based on an approval received from the PCIT - Assessment of trust - Addition u/s. 56(2)(vii) - difference between turnover shown in the Income Tax return and turnover shown in Service Tax return - assessee is a private discretionary trust - JCIT, Non Corporate Range 2, Chennai passed an order u/s. 144A directing to treat a corpus donation received by the assessee trust during the relevant previous year, as income under the head "income from other sources" - AR submitted that ld. JCIT had invoked Sec. 144A of the Act, even when an assessment was not pending HELD THAT:- As the assessment order clearly states that notice u/s. 143(2) of the Act was issued to the assessee on 01.06.2016. Thus, clearly when....... + More
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2017 (7) TMI 1393
Disallowance u/s 14A r.w.r 8D - disallowance being 0.5% on the average value of investment - HELD THAT:- AR submitted that assessee has not earned any exempt income during the year - we find that the issue is squarely covered in favour of the assessee by the decision of the Hon'ble Delhi High Court in the case of Cheminvest Limited [2015 (9) TMI 238 - DELHI HIGH COURT] wherein it has been held that in absence of exempt income during the year no disallowance under Section 14A of the Act can be made. Thus, ground No. 1 is allowed. Disallowance on account of increase in net profit being 1% of the turnover made by AO by disallowing the expenditure - AO was of the view that though the provisions of Section 92BA relating to the related party domestic transactions are effective only from 1 April 2013 but he looked into the reasons for making....... + More
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2017 (7) TMI 1392
Exemption u/s 11 - denying the assessee registration u/s 12AA - transfer of the funds from M/s Mata Narayan Kaur Charitable Trust to the assessee trust of ₹ 1.57 crores appear to be a method to transfer funds from a non functional trust headed by the husband to a trust headed by wife to preclude the possibility of the dissolution of the donor trust - HELD THAT:- Assessee trust had received donation of ₹ 1.57 crores from M/s Mata Narayan Kaur Charitable Trust. Whether the said donation was to preclude dissolution of the donor trust or that it was made from accumulated funds which had not been utilized in the specified time frame, have no effect nor do they affect the genuineness of the assessee trust. Whatever may have been done by the donor trust, may have an impact on the genuineness of the donor trust and there is no reason ....... + More
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2017 (7) TMI 1390
Revision u/s 263 - verification of purchases - Outstanding sundry creditors - assessee was making payment for purchase after ten months or one year which is not normal in the business practice - HELD THAT:- AO asked for details of payment to sundry creditors outstanding as on 31-03-2012 exceeding ₹ 1 lacks per party with evidence of payment subsequently. Assessee filed statements giving details of subsequent payments to the sundry creditors exceeding ₹ 1 lacks and also produced copies of ledger accounts of these parties for subsequent assessment years wherein the payment received from assessee through banking channels is reflected. As regard to the query of the AO that the assessee has received credits on account of purchased from parties, it was explained that the assessee group including the partners independently is develop....... + More
