- 2018 (6) TMI 1738 - ITAT MUMBAI
Addition u/s 14A r.w.r. - Non recording of satisfaction by AO - HELD THAT:- A.O while dislodging the claim of the assessee that as no part of the expenses debited in the profit and loss account was relatable to earning of the exempt dividend income, thus no disallowance under Sec. 14A was called for in its hands, had failed to record his satisfaction as regards the correctness of such claim, having regard to the accounts of the assessee. Rather, we find that the A.O had dislodged the claim of the assessee that no disallowance under Sec. 14A was liable to be made in its hands by holding a conviction that it was beyond comprehension that no expense incurred by the assessee could be related to earning of exempt dividend income. We are of the considered view that in the backdrop of the judgment in the case of Godrej & Boyce Manufacturing ....... + More
- 2018 (6) TMI 1736 - ITAT DELHI
TDS u/s 194J - TDS on discount and roaming charges - default u/s 201(1) - HELD THAT:- As decided in own case [2018 (5) TMI 582 - ITAT DELHI] in absence of any human intervention during the actual roaming process, payment would not be Fees for Technical services - Thus, payment made to other telecom operators should not be regarded as payment towards fees for technical service. No Tds liability - Decided in favour of assessee.
- 2018 (6) TMI 1735 - ITAT MUMBAI
Addition made on account of interest expenditure - advancement of loans - HELD THAT:- We find that the assessee had advanced loan to AHPL for its business, that the financial institutions had advanced loans for a specific purpose, that the borrowed funds were utilised for those purposes only. It appears that the AO had not understood the real character of the loans availed by the assessee. He had not also considered overall availability of the loans sanctioned by the financial institutions. FAA had given a finding of fact that borrowed funds were not utilised for the specific purposes and that the assessee had used its own funds for making investments. The available funds with it were in excess of the investments. Considering these facts, we are of the opinion that there is no need to interfere with the order of the FAA. So, confirming hi....... + More
- 2018 (6) TMI 1734 - ITAT BANGALORE
Admission made in the assessment proceedings by authorised representative - Whether admission made by the authorised representative is not binding on the assessee, is not absolute and correct proposition of law? - HELD THAT:- Admission made by the authorised representative in the proceedings having expressly or implied authority binds the assessee and therefore we have no iota of doubt that the statement made by the authorised representative binds the assessee - in our view, the jurist entity like the assessee before us, shall always be represented either through the Director or the MD or the Company Secretary or by any other person including the authorised person through a Board Resolution. If we hold that the Act of the representative does not bind the assessee, the very basis of working of the judicial system would collapse. Accordingl....... + More
- 2018 (6) TMI 1733 - ITAT AMRITSAR
Validity of the notice u/s. 143(2) - issue of notice by AO not having jurisdiction to assess assessee in terms of the territorial area assigned to him u/s. 120 - transfer of the assessee’s return by ITO, Ward II(3), Jalandhar to another ITO (at Jalandhar, where the assessee’s office is locate - HELD THAT:- The whole purport of law, as we see it, is from the standpoint as to whether any prejudice is caused to the assessee. The transfer of the assessee’s return by ITO, Ward II(3), Jalandhar to another ITO (at Jalandhar, where the assessee’s office is locate, and in fact, the ITO with whom he filed his return) would not make the issue of notice u/s. 143(2) by him on 15.09.2010 (or 21.09.2010) invalid. This is irrespective of whether the said transfer is prompted by the assessee’s objection-as contended by the as....... + More
- 2018 (6) TMI 1731 - ITAT PUNE
Unaccounted transaction of undisclosed receipts and undisputedly undisclosed expenditure outside the books of account - survey action u/s.133A - discovery of incriminating information and the papers/ documents relating to both the assessee under consideration - disclosure of additional income includes that the assessee earned unaccounted income on sale of stock and incurred unaccounted expenditure outside the books - HELD THAT:- Demand for the said adjustment in principle has the basis of the figures emanating from the impounded papers during the survey action. Assessee already offered the additional income of ₹ 2.06 crores and paid taxes on this. Over and above the same, AO made addition of ₹ 1.61 crores and the same is the subject of all this litigation. Therefore, there is no justification for rejecting the claim of adjustm....... + More
- 2018 (6) TMI 1730 - ITAT BANGALORE
Disallowance of interest payment on belated TDS payment - case of the appellant inter-alia that interest on late payment of TDS is compensatoryand not penal in nature; that TDS is not a liability in the hands of the deductor; that interest paid on account belated TDS payment is only to compensate the loss, if any; etc, and therefore, the same is allowable - HELD THAT:- As decided in Narayani Ispat Pvt. Ltd. [2017 (10) TMI 67 - ITAT KOLKATA] AO has wrongly applied the principle laid down by the Hon'ble Supreme Court in the case of Bharat Commerce Industries Ltd [1998 (3) TMI 2 - SUPREME COURT] We also find that the Hon'ble Supreme Court in the case of Lachmandas Mathura [1997 (12) TMI 16 - SUPREME COURT] has allowed the deduction on account of interest on late deposit of sales tax u/s 37(1) of the Act. In view of the above, we conc....... + More
- 2018 (6) TMI 1729 - ITAT PUNE
Deemed income u/s.69/69B - Income disclosed in survey action u/s.133A - taxation for discrepancies in the stock of gold and silver - HELD THAT:- There was survey action on the assessee and the same resulted in the disclosure of additional income of ₹ 1.25 crores on account of excess stock of gold and jewellery. It is also a fact that the assessee reflected the said income in the profit and loss account while filing the return of income. The requisite taxes were also paid on the said income. We find disclosure of said additional income is closely linked to the excess closing stock of assessee and consequently the business nature of the said additional income. As decided in M/S. SUREKH JEWELLERS [2016 (8) TMI 1140 - ITAT PUNE] additional income disclosed by the assessee in the survey action u/s.133A partakes the character of business ....... + More
- 2018 (6) TMI 1725 - ITAT MUMBAI
Correct head of income - fixed deposit interest income - Income from Business & Profession or Income from Other Sources - FAA had allowed the claim made by the assessee on the grounds that it was in the business of production of films that the completion of films would take time that during the intervening period the advances were deposited with bank resulting in accrual of interest income - HELD THAT:- We find that these basic finding of the FAA have not been challenged by the Department. It is also a fact that Government of India was 100% shareholder of the assessee-company and the deposit of advances with the banks was directly and inextricably linked with the business of the assessee,so the interest earned by it had to be treated as income earned from business and cannot not be treated as income from other sources - interest earne....... + More
- 2018 (6) TMI 1724 - ITAT DELHI
TDS u/s 195 - disallowance u/s. 40(a)(i) for non-deduction of TDS - payment made by the assessee to a non- resident as agency commission - CIT(A) deleted the addition - HELD THAT:- CIT(A) has rightly deleted the addition in dispute by following the various case laws as well as following the Ld. CIT(A)-XII, New Delhi Order passed in assessment year 2009-10 in assessee’s own case wherein relying WELSPUN CORPORATION LIMITED AND VICE-VERSA [2017 (1) TMI 1084 - ITAT AHMEDABAD] held that on payments made by assessee for services rendered by non-resident agents could not be held to be fees for payment for technical services, these payments were in nature of commission earned from services rendered outside India which had no tax implications in India. Decision of Hon’ble Madras High Court in the case of CIT vs. Kikani Exports Pvt. Ltd....... + More
- 2018 (6) TMI 1723 - ITAT MUMBAI
Disallowance of excess claim of depreciation - HELD THAT:- As decided in own case [2014 (5) TMI 926 - ITAT MUMBAI] direct the AO to allow the depreciation on the machinery that had been acquired from Bilag, and also include incidental expenses incurred on acquisition of assets. Depreciation on goodwill - HELD THAT:- As decided in own case [2014 (5) TMI 926 - ITAT MUMBAI] relying on Smifs Securities Ltd. [2012 (8) TMI 713 - SUPREME COURT] - intangibles like goodwill are eligible for depreciation - non compete fee is in the nature of the payment and is now covered u/s 28(va) of the Act, it would be revenue in nature - AO is directed to allow the depreciation on goodwill as per law and consider the payment of non-compete fee, in terms of section 28(va) - Decided in favour of Assessee.
- 2018 (6) TMI 1721 - ITAT CHENNAI
Interest receipt - Income from other sources or Capital gain - whether assessee is not entitled to set off of business expenses against the income shown under the head ‘income from other sources’ as the business of the assessee has not commenced ? - HELD THAT:- The assessee has parked the loan amount in short term deposits with Banks and other financial institution and earned interest income, which has no direct nexus and the interest income is directly attributable to the deposits made out of funds generated by way of term loans. We are of the considered opinion that the interest earned by the assessee has to be treated as income on commercial principles. Having regard to the judgment in the case of Tuticorin Alkali Chemicals and Fertilisers Ltd v CIT [1997 (7) TMI 4 - SUPREME COURT] AND in the case of CIT v. Autokast Ltd. [2....... + More
- 2018 (6) TMI 1720 - ITAT MUMBAI
Disallowance of expenses relating to exempt income made u/s 14A - disallowance made for computing book profit u/s 115JB - HELD THAT:- Special Bench in the case of Vireet Investment P. Ltd., [2017 (6) TMI 1124 - ITAT DELHI] the direction of the CIT(A) to adopt the disallowance made under Section 14A for the purpose of computing book profit u/s 115JB is liable to be set aside. The assessee also took us to the working made by it for ascertaining the expenses relating to exempt income for the purpose of computation of book profit u/s 115JB. We noticed that the assessee has allocated expenses in the ratio of taxable income and exempt income and the said method was determined by the Department in A.Y. 2000-01. It is stated that the same method is being followed for A.Y. 2000-01 onwards by the assessee. Since a consistent method is being followe....... + More
- 2018 (6) TMI 1717 - ITAT MUMBAI
TP Adjustment - application of most appropriate transfer pricing method and the arm‟s length price - international transactions - HELD THAT:- Functions performed, assets employed and risk undertaken by the assessee and its associated enterprises was found to be reasonable. Accordingly, we allow assessee to withdraw these grounds for the A.Y.2008-09 and 2009-10 in so far as these grounds are covered by the APA, the principle laid down in the APA for benchmarking analysis in respect of the international transactions being guidance value since there is no change in the said assessment years in the nature of international transactions. We also direct the Department to pass an order giving effect u/s.92 CD (5) of the Act in the A.Y. 2010-11 & 2011-12. Whereas for A.Y.2008-09 and A.Y.2009-10, we observe that the principles laid down i....... + More
- 2018 (6) TMI 1716 - ITAT AMRITSAR
Validity of reopening of assessment u/s 147 - eligibility of reasons to believe - HELD THAT:- In the present case, we find that the first sentence of the so-called reasons recorded by AO speaks that "there is information in the possession of this office". The first part is only information and the second paragraph of the so-called reasons is mere reason and third part is directions of the superior authority. From the so-called reasons, it is not at all discernible as to whether the Assessing Officer had applied his mind to the information and independently arrived at a belief that on the basis of the material which he had before him, income had escaped assessment. Assessing Officer failed to make any exercise for reopening of the case independently and with corroborative material. Even the Assessing Officer has not made any exer....... + More
- 2018 (6) TMI 1713 - ITAT CHENNAI
Reopening of assessment u/s 147 - unexplained investments addition u/s 69 - CIT(A) held that the Assessing Officer validly completed the assessment under section 143(3) r.w.s. 147 - Assessee submitted during the course of hearing of this appeal, the addition made in the reassessment may be deleted and justice be rendered - HELD THAT:- We direct the CIT(A) to adjudicate the issue on merits with regard to the addition made under section 69 of the Act in accordance with law by allowing an opportunity of being heard to the assessee. Appeal filed by the assessee is allowed for statistical purposes.
- 2018 (6) TMI 1711 - ITAT MUMBAI
Disallowance of club membership of fee - AO disallowed partial amount of total club membership expenses on the ground that the assessee failed to furnish evidences - HELD THAT:- It is the contention of the assessee that it has filed details for balance amount of ₹ 2,30,623/- before the Ld. CIT(A) vide its submission dated 22.01.13. Such details have been furnished before us in the form of paper book. Therefore, we are of the considered view that the issue needs to be reexamined by the AO, in the light of evidences filed by the assessee. Hence, we set aside the issue to the file of AO and direct him to consider the issue afresh after affording a reasonable opportunity of hearing to the assessee. Disallowance of expenses incurred in relation to exempt income under section 14A r.w.r. 8D - HELD THAT:- Once the assessee has proved the av....... + More
- 2018 (6) TMI 1708 - ITAT DELHI
Exemption u/s 11 - specific services to member as well as non-members by charging fees - HELD THAT:- Rendering specific services to member as well as non-members by charging fees and applicability of exemption u/s 11 of the Act has already been decided by the Hon’ble Delhi High Court [2012 (11) TMI 429 - DELHI HIGH COURT] by holding that the assessee society is entitled to get benefit u/s 11. DR also raised an issue that post amendment to the proviso to Section 2(15) of the Act , the situation has become altogether different from the AY 2009-10 onwards and the activities of the Assessee are liable to be treated as business activities, however, we realized that co-ordinate bench of ITAT at Delhi in the assessee’s own case for the AYs 2008-09 & 2009-10 duly considered and adjudicated the said issue and nothing is brought on record by Ld. DR, contrary to the said judgments and/or filing of any appeal against the same. - Decided against revenue.
- 2018 (6) TMI 1707 - ITAT PUNE
TP Adjustment - comparable selection - HELD THAT:- Assessee was providing e-learning solutions i.e. IT enabled services like content technology services, desktop technology services, e-learning and conversion services to its associated enterprises. Accentia Technologies Ltd to be excluded as being not functionally comparable to the activities carried on by the assessee Not considering foreign exchange gain as operating income while calculating the PLI of assessee - The foreign exchange fluctuation is in respect of revenue earned from the associated enterprises vis-à-vis provision of ITES services and hence, the same forms part of the operating income / cost. The Assessing Officer / TPO is thus, directed to verify the claim of assessee in this regard and re- compute the PLI of assessee and the comparables. It may also be pointed out....... + More
- 2018 (6) TMI 1705 - ITAT PUNE
Additional income declared by the appellant in the course of survey u/s.133A - deemed income u/s.69A - claim of set off of brought forward losses against the additional income - disallowance of provision for warranty - HELD THAT:- Income offered on the basis of the impounded documents collected during the survey action conducted on 24-01-2007 on the assessee. These documents clearly reflect the unexplained expenditure and unexplained receipts relates to sale of flats to the parties. Assessee is a Builder and his business is to construct the flats and sell the same to the customers. All these details clearly indicate the business nexus of the receipts/expenditure to the core business activities of the assessee. It is not the case that there was any cash impounded or seized in this case to deny such claim of set off as the source of the sam....... + More
