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Income Tax - Tribunal - Case Laws
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- 2020 (9) TMI 1130 - ITAT BANGALORE
Rectification u/s 254 - part of income which was not accounted on the basis of accrual system of accounting had been offered to tax in the very same assessment year i.e., AY 2012-13 - plea of assessee that the sum added by the AO on the basis of mercantile system of accounting was offered by the assessee to tax in a later assessment year as income and therefore the addition made will amount to taxation of the same income twice - HELD THAT:- We are of the view that the words “either in this year or” should be added to line 6 of para 14 of the order of Tribunal, after the words “how the income offered” so that the 6th line of para 14 reads as under:- “how the income offered either in this year or in a later assessment year was income which was” We hold and order accordingly. Absence of insertion of the af....... + More
- 2020 (9) TMI 1129 - ITAT BANGALORE
Rectification of mistake u/s 254 - Capital gains chargeable to tax - sum was received by the assessee on his retirement from a partnership firm - Tribunal said that right of a partner in the firm is a capital asset and when that is relinquished, the consideration paid on such relinquishment, over and above the sum credited to the capital account of the concerned partner should be regarded as capital gain and brought to tax. Goodwill was not an asset which was subject matter of transfer and therefore the provisions of section 55(2)(a) of the Act will not apply - HELD THAT:- What was subject matter of transfer was right of partner in the partnership firm which comprises of several components, goodwill being one of the components. Apart from the above, we are also of the view that the issue that is sought to be agitated by the revenue in thi....... + More
- 2020 (9) TMI 1128 - ITAT MUMBAI
Revision u/s 263 - addition in respect of notional annual letting value on unsold flats held as stock in trade - assessee contended that notional annual letting value of unsold flats held as stock-in-trade is a debatable issue - HELD THAT:- In the present case we are of considered view that the assessment order sought to be revised does not suffer from error as pointed by the PCIT. Merely for the reason that PCIT does not agree with one of the possible view taken by the AO, would not make the assessment order erroneous. PCIT has erred in invoking the provisions of section 263 therefore, the impugned order is liable to be quashed. We may also like to add here that sub-section (5) to Section 23 has been inserted by the Finance Act, 2017 w.e.f. 01-4-2018, whereby notional annual value of property/part of property held has stock-in-trade has ....... + More
- 2020 (9) TMI 1127 - ITAT DELHI
Unaccounted cash receipt for sale of property - during the course of examination by the Investigation Wing, the assessee was confronted with a receipt and the assessee was never asked for any further amount received by him - cancelled receipt which the Investigation Wing considered proper not to confront with the assessee - HELD THAT:- A perusal of the receipt which is placed shows that it is a cancelled one. AO has not confronted the contents of the said receipts from Shri Shashi Kant Aggarwal, although his complete address was mentioned in the said sheet of paper. Since the Investigation Wing after considering this cancelled cheque has never confronted the assessee regarding the receipt of ₹ 50 lacs, therefore, in absence of any other corroborative material before the AO, he is not justified in making the addition. A perusal of th....... + More
- 2020 (9) TMI 1126 - ITAT CUTTACK
Revision u/s 263 - CIT directing AO for re-examination of the audited accounts and examine the genuineness of unsecured loan, Sundry Creditors/ details of payable and also Sundry Debtors shown under current assets of the balance sheet - Also re-examine the valuation of stock recorded in the books of account of the assessee which has reported to the bank - HELD THAT:- Pr.CIT has observed that there is stock statement on record which has been submitted by the assessee to the Punjab National Bank in inflated value, therefore, the difference shall be treated as unaccounted sales. In respect of other findings of the ld.Pr.CIT, the AO did not enquire in depth which ought to have been done for competing the assessment proceedings as per the provisions of I.T.Act. Even before the proceeding u/s.263/143(3) of the Act before the AO, the assessee di....... + More
- 2020 (9) TMI 1125 - ITAT LUCKNOW
Reopening of assessment u/s 147 - non issue of notice u/s 148 on correct address - Applicability of section 292 BB - plea of the assessee that notice u/s 148 was wrongly issued to the assessee, as he had duly complied AIR notice and explained the source of deposit - whether the notice issued u/s 148 of the Act was served upon the assessee or not? - HELD THAT:- As clearly held that notice has to be issued either on the address available in PAN database or address available in the income tax return and has clearly held that the AO was circumscribed and bound by the express mandate of Rule 127. As held in this case that is the notice could not be served on the address available in the PAN data base or at the address mentioned in Income Tax Return only then the notice can be issued on the address mentioned in banking company or post office. N....... + More
- 2020 (9) TMI 1124 - ITAT MUMBAI
Levy of penalty u/s 271(1)(c) - whether the assessee is entitled for depreciation on properties which were let out, income from which is taxed under the head ‘income from house property’? - CIT(A) had disallowed the said depreciation on the ground that since the rental income derived from those properties were taxed under the head ‘income from house property’ and assessee would be entitled for statutory deduction @30% towards repairs alone and no further deduction is permissible under the head ‘ income from house property’ - HELD THAT:- This is a case where penalty has been initiated on one limb of the offence and penalty levied ultimately on a different limb of the offence. In these type of cases, the Hon’ble Jurisdictional High Court had held that when there is no satisfaction recorded by the ld....... + More
- 2020 (9) TMI 1123 - ITAT MUMBAI
Disallowance of selling and marketing expenses paid - Commission on sale - receipt from the sale of FSI was not offered to tax, therefore, the expenses was not liable to be allowed - As argued that the commission or brokerage expenses are accrued and the liabilities towards such expenses are created as soon as the deal takes place between the assessee company and the party and accordingly the brokerage/commission is due, hence, the claim of the assessee is liable to be allowed - HELD THAT:- The assessee company has paid 2% commission on sale of FSI 53.33 crores for the year under consideration. The commission has been booked against these transactions in the year under consideration. Since the FSI was not offered in the current year, therefore, the AO has declined the claim. It nowhere seems justifiable in view of the decision in the case....... + More
- 2020 (9) TMI 1122 - ITAT MUMBAI
Estimation of income - bogus purchases - addition made on account of @8% on the value of alleged bogus purchases - HELD THAT:- Assessee had disclosed total gross profit of 3.6%. Since, assessee is engaged in the business of export of cut and polished diamonds, there is no question of any VAT portion incurred by the assessee on the purchases. Gross profit disclosed by the assessee on the disputed purchases was 2.42%. These facts were not controverted by the revenue before us. Profit element determined @8% is on the much higher side and we deem it fit to estimate the profit @3% on the value of purchases treated as non-genuine by placing reliance on Ralf Jems Pvt. Ltd [2019 (9) TMI 1402 - ITAT MUMBAI]. Ground raised by the assessee is partly allowed.
- 2020 (9) TMI 1103 - ITAT PUNE
Allowability of deduction u/s 80IA(4)(iii) - as per revenue no single entity or its related enterprise can occupy more than 25% of the allocable area was violated - CIT-A allowed deduction - whether CIT(A) was justified in holding that the assessee is eligible for deduction while the condition that minimum number of 30 units should be operational for availing the benefit was not met since by 31.03.2010 only 16 units were operational? - HELD THAT:- When there is no counter findings placed on record by the Department, we do not find any reason to deviate from the view taken in assessee’s own case for A.Y. 2011-12 [2018 (4) TMI 1821 - ITAT PUNE] and following the same, we are of the considered view that the relief provided by the learned Commissioner of Income Tax (Appeals) to the assessee allowing the claim of deduction u/s 80IA(4)(iii) of the Act was done correctly and the said relief provided to the assessee is sustained.
- 2020 (9) TMI 1102 - ITAT BANGALORE
Computation of deduction u/s.10A - reducing the impugned expenses both from the export turnover as well as from the total turnover - HELD THAT:- The issue raised is squarely covered in favour of assessee by the judgment in the case of CIT v. HCL Technologies Ltd. [2018 (5) TMI 357 - SUPREME COURT] had categorically held that when expenses are reduced from export turnover, the same needs to be reduced also from the total turnover, while computing deduction u/s. 10A - DRP is justified in its direction that the impugned expenditure that is reduced from the export turnover need to be reduced also from the total turnover, while computing deduction u/s. 10A - Decided against revenue. Set off of brought forward losses - AO has reduced the brought forward losses from Bangalore (10AA unit) and Mumbai (10A unit) before computation of deduction u/s ....... + More
- 2020 (9) TMI 1101 - ITAT MUMBAI
TP Adjustment - adjustment arising out of performance guarantee provided by assessee to an entity - HELD THAT:- The bank guarantee was given by Bank of India. The bank utilized the guarantee facility sanctioned to assessee while sanctioning aforesaid bank guarantee to assessee’s AE. The assessee, based on letter obtained from the bank, charged guarantee commission of 0.60% from its subsidiary. The Ld. TPO estimated the same @1%. We find that this issue is contained in assessee’s own case for AY 2010-11. [2019 (9) TMI 437 - ITAT MUMBAI] as concluded that internal CUP in the shape of commission charged by the bank, would be most direct and reliable way to apply Arm’s Length Principle. Further, when there was absolutely no loss to the assessee and entire cost was recovered from the AE, no further adjustment would be require....... + More
- 2020 (9) TMI 1100 - ITAT MUMBAI
Addition u/s 40(a)(ia) - Non-deduction of TDS u/s 194H - discount versus commission - Held that:- the assessee was not required to deduct TDS on the amounts of discount on sale of Set-top box and hardware, discount on sale of recharge coupon and vouchers, bonus or credit provided by assessee to subscribers, sales promotion expenses and distribution channel support expenses. - transaction between the company and distributor is on principal to principal basis and all the risk, loss, damages are transferred to distributor on delivery. Distributors are free to sale at any price below maximum retail price. In this regard, the assesse has filed the sample copy of invoices for sale of Set Top Box (STB) and other recharge coupons to prove that it is a sale but not services to come within the ambit of the definition of commission as defined under ....... + More
- 2020 (9) TMI 1099 - ITAT MUMBAI
TP Adjustment - comparable selection - functional dissimilarity - HELD THAT:- Assessee provided investment advisory services, in respect of listed Indian securities to its overseas AE. Investment Advisory Services refer to the support services provided by the Indian firms to the overseas fund managers in equity and general business research. Further, equity research relates to building and maintaining valuation models, ratio analysis, competitor analysis, comparable valuation method etc. Business research includes services, such as study and analysis of the industry of the target company, company profiles and study of the macroeconomic environment of the target country, thus companies functinally dissimilar with that of assessee need to be deselected from final list. ICRA Management Consulting Services Ltd. (‘IMCSL’), Informed....... + More
- 2020 (9) TMI 1098 - ITAT MUMBAI
TP Adjustment - Disallowance of the claim of adjustment for extraordinary expenses relating to recovery of production overheads, selling and administrative overheads, one time technological fee for Chennai metro in the Transport segment - HELD THAT:- Adjustment on account of extraordinary expenses in production overheads and selling and administrative overheads claimed by the assessee are not of any specific distinct expenditure. These are the regular expenses normally incurred by the assessee during the course of business. As rightly pointed out by the DRP, the assessee has proceeded to make adjustment in its profits despite the assessee being the tested party. There is nothing on record to suggest that in the comparables submitted, whether there was any adjustment for extraordinary and non-recurring items. This was required as evident f....... + More
- 2020 (9) TMI 1097 - ITAT DELHI
Late fees payable u/s 234E - intimation issued under section 200A(3) - default in not filing TDS returns in time - Rectification u/s 154 - Assessee stressed that no fee can be levied under section 234E of the Act for the periods prior to 01.06.2015, when the intimation under section 200A of the Act was issued - Scope of amendment - HELD THAT:- The machinery provisions of charging the said fee as per clause (c) of Section 200A(1) of the Act was inserted by legislature with effect from 01.06.2015. We find that the said issue has been decided in the case of Fateh Raj Singhvi & Ors. vs UOI [2016 (9) TMI 964 - KARNATAKA HIGH COURT] and it is held that section 200A of the Act inserted with effect from 01.06.2015 had prospective effect and was not applicable for different quarters of assessment years prior to 01.06.2015. Power is being enshr....... + More
- 2020 (9) TMI 1096 - ITAT DELHI
TP Adjustment - inclusion/exclusion of TCS-e-Serve Ltd. by the TPO - HELD THAT:- One of the key reason why the TCS-e-serve Ltd. cannot be held to be comparable with the assessee company which is providing back office support services, i.e., ITeS/BPO services, because TCS-e-Serve in addition to ITeS/BPO services also render technical services like software testing and validation of software which falls under software development services activity. Admittedly, the assessee is a low risk captive unit involved in provision of back office support service to it’s group companies for which it is remunerated at cost plus basis and is not exposed to any kind of risk. Whereas, the TCS-e-serve Ltd. bears significant risk such a macro economic risk, regulatory risk, financial risk and risks from operations etc. which clearly indicates that the ....... + More
- 2020 (9) TMI 1095 - ITAT DELHI
Exemption u/s 11 - charitable or commercial activities - assessee was earning huge profits by providing data connectivity to its subscribers in lieu of consideration as per its objects and nowhere, charity can be seen in the whole process - charitable or commercial activities - assessee is an autonomous society established under the aegis of Department of Information Technology, Ministry of Communications and Information Technology, Government of India, as a non-profit organization - HELD THAT:- As decided in own case [2018 (1) TMI 189 - ITAT DELHI] activity of the petitioner involves promotion, propagation and spreading awareness and knowledge about global coding identification system GS1. The entire expenditure of the petitioner has to be taken into consideration and cannot be ignored. There are stipulations in sections 11, 13, etc., of....... + More
- 2020 (9) TMI 1094 - ITAT KOLKATA
Assessment u/s 153A - additions/disallowances made in the assessments of the appellant and M/s IQCIPL which were unabated [since assessment of AY 2013-14 was non-pending] on the date of search, could be held to be sustainable on facts and in law? - HELD THAT:- Additions/disallowances made by the AO on account of alleged on-monies/cash received on sale of flats & car parks in the Shiromani Project was clearly beyond the scope of authority vested under section 153A owing to absence of any incriminating material or evidence deduced as a result of search conducted at the premises of the assessee in so far as unabated assessment for AY 2013- 14 is concerned. At the time of hearing before us, neither the Ld. CIT DR was able to controvert this contention of the Ld. AR nor the grounds of appeal preferred by the revenue assails the aforesaid f....... + More
- 2020 (9) TMI 1093 - ITAT BANGALORE
TP Adjustment - comparable selection - HELD THAT:- Assessee which is a captive software development service provider and renders software development and solutions and ITES to support the global contracts negotiated by Aspect US and other affiliates, thus companies functionally dissimilar with that of assessee need to be deselected. Information Technology Enables service segment - Exclusion of company functionally dissimilar and who fails the TPO’s own filter of export turnover in excess of 75% of total sales. Determining a negative working capital adjustment in both the SWD services Segment and ITeS segment - HELD THAT:- The Assessee is running the business without any working capital risk as compared to the comparables. Therefore, requirement for adjustment of negative working capital does not arise. negative working capital adjus....... + More
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