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Income Tax - Case Laws
Showing 361 to 366 of 366 Records
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2020 (7) TMI 14 - ITAT LUCKNOW
TDS u/s 194C OR 195 - Shipping Expenses on account of non deduction of TDS u/s 40(a)(ia) - payment of ocean freight, made to non-resident shipping companies - HELD THAT:- The provisions of section 172 are to apply, notwithstanding anything contained in other ' provisions of the Act. Therefore, in such cases, the provisions of sections 194C and 195 relating to tax deduction at source are not applicable. The recovery of tax is to be regulated, for a voyage undertaken from any port in India by a ship under the provisions of section 172.
Section 194C deals with work contracts including carriage of goods and passengers by any mode of transport other than railways. This section applies to payments made by a person referred to in clauses (a) to (j) of sub-section (1) to any "resident" (termed as contractor). It is clear from the section that the area of operation of TDS is confined to payments made to any "resident". On the other hand, section 172 operates in the area of computation of profits from shipping business of non-residents. Thus, there is no overlapping in the areas of operation of these sections.
There would, however, be cases where payments are made to shipping agents of non-resident ship-owners or charterers for carriage of passengers etc., shipped at a port in India. Since, the agent acts on behalf of the non-resident ship-owner or charterer, he steps into the shoes of the principal. Accordingly, provisions of section 172 shall apply and those of sections 194C and 195 will not apply.
Addition on difference between the opening balance in the account of M/s Eskay Sales Corporation and in the accounts of the assessee - HELD THAT:- We find that Assessing Officer has made the disallowance simply by holding that the assessee produced ledger account of these expenses which are not open to full verification and hence has disallowed 10% out of various expenses. The Assessing Officer has nowhere pointed out any specific discrepancy in the books of account nor he has rejected the same. In our opinion, the Assessing Officer cannot make ad hoc disallowance. See ASHOK SURANA VERSUS COMMISSIONER OF INCOME-TAX [2016 (6) TMI 696 - CALCUTTA HIGH COURT] - Decided in favour of assessee.
Order being pronounced after ninety (90) days of hearing - COVID-19 pandemic and lockdown - HELD THAT:- Taking note of the extraordinary situation in the light of the COVID-19 pandemic and lockdown, the period of lockdown days need to be excluded. See case of DCIT vs. JSW Limited [2020 (5) TMI 359 - ITAT MUMBAI]
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2020 (7) TMI 13 - ITAT LUCKNOW
Penalty u/s 271(1)(c) - allegation of defective notice - charge is not specific for which penalty is levied - HELD THAT:- From a perusal of this notice, it is crystal clear that the charge is not specific for which penalty is levied under section 271(1)(c) of the Act, whether for concealment of income or for furnishing of inaccurate particulars of income.
The notice has specified both charges, i.e., concealment of income and furnishing of inaccurate particulars of income and has not specified the charge for which action has been taken against assessee. The non specific nature of the notice indicates non application of mind by Assessing Officer.
It is a settled position of law that if notice under section 274 read with 271(1)(c) is not specific about the charge or limb under which penalty is being levied under section 271(1)(c) of the Act, then any penalty levied on the basis of such notice is bad in law and liable to be deleted.
Law mandates that the authority, who is proposing to impose penalty, shall be certain as to what basis penalty is being levied and notice must reflect that specific reason so that assessee, to whom such notice is given, can well prepare himself regarding defence, which he likes to take to support his case. This is even enshrined in the principles of natural justice and as has been upheld by Hon'ble Apex Court and other High Courts. Thus notice under section 274 read with 271(1)(c) of the Act, which has not specified the charge and limb under which penalty should be levied, it is void ab initio. Decided in favour of assessee.
Order being pronounced after ninety (90) days of hearing - COVID-19 pandemic and lockdown - HELD THAT:- Taking note of the extraordinary situation in the light of the COVID-19 pandemic and lockdown, the period of lockdown days need to be excluded. See case of DCIT vs. JSW Limited [2020 (5) TMI 359 - ITAT MUMBAI]
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2020 (7) TMI 12 - ITAT GUWAHATI
Seeking recalling of an order - Reasonable cause for the assessee to seek adjournment - violation of the principle of Natural Justice - Tribunal was of the opinion that since no Vakalatnama had been filed in the name of Shri Somnath Ghosh (Advocate appeared and sought for adjournment) the adjournment application was rejected and the Bench proceeded to dispose of the appeals after hearing the Ld. DR - HELD THAT:- We note from a perusal of the Misc. Application which has been verified by Shri Varun More, Director of the assessee company that though the assessee had infact authorized Shri Somnath Ghosh to appear on behalf of the assessee. However, since the copy of the appeal could be given only a day before the case was listed for hearing, the Advocate could not be briefed by the Director of the assessee company because he was recovering from viral fever and also was infected with Pharyngitis. Prescription of the doctor has also been enclosed along with the adjournment application. So, according to us, there was reasonable cause for the assessee to seek adjournment. However, in the impugned order the Tribunal taking note that no Vakalatnama in the name of Shri Somnath Ghosh was filed before it, the Tribunal took a view that Shri Somnath Ghosh, Advocate is not the AR of the assessee and, therefore, it proceeded ex parte qua the assessee.
Assessee company had authenticated that Shri Somnath Ghosh, Advocate is their AR and, therefore, we are of the opinion that due to confusion created because of non-filing of Vakalatnama had led to the impugned order being passed by the Tribunal. There has been a violation of the principle of Natural Justice and, according to us, since assessee had not been effectively heard/not-heard before the disposal of the appeal, we recall the impugned order of the Tribunal and the Registry is directed to fix all the aforementioned appeals that are restored in due course. Misc. applications of assessee are allowed.
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2020 (7) TMI 11 - ITAT GUWAHATI
Rectification of mistake - Penalty u/s 271(1)(c) - as per notice assessee had faulted on both the charges i.e. having concealed particulars of income as well as furnished inaccurate particulars of such income - HELD THAT:- According to us, sometimes in some cases, it may attract both the offences and in some cases there may be overlapping of the two charges, then in such event in the penalty proceedings also notice should clearly specify the same by adding the adjunctive ‘and’ and not the disjunctive ‘or’. The omission of the AO to strike of ‘or’ between the two charges and write/add ‘and’ in between both the charges makes the notice vague.
So, even if the AO is of the opinion that action/omission of assessee attracts both the charges, then it was incumbent upon him, to put the assessee on notice by expressing his intention to proceed against the assessee for both charges by striking out ‘or’ and substituting it with ‘and’ which AO has failed to do in this case.
AO by not bothering even to do the exercise as suggested by us reveals the mechanical approach of issuing penalty notice which action exposes the non-application of the mind on the part of the AO to put the assessee on clear notice for which he intends to levy penalty. Moreover, it has to be kept in mind that the assessment proceeding is distinct from the penalty proceedings and it is a settled law that imposition of penalty is discretionary and not mandatory. Any observation or finding made in the assessment order cannot come to the rescue of the AO’s action of issuing defective/vague penalty notice. So, in the facts and circumstances discussed supra, the Misc. Application filed by the Revenue fails since we find no error leave alone error apparent on the face of the impugned order of the Tribunal.
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2020 (7) TMI 10 - ITAT DELHI
Non admission of additional evidence - CIT(A) has not admitted the copy of ledger account of the sundry creditors and copy of the their confirmation filed by assessee as additional evidence under Rule 46A of the Income Tax Rules, 1962 - HELD THAT:- On perusal of the Rule 46A(1) of the Rules, it is evident that the assessee has been prohibited from producing the additional evidence except the four circumstances. The first circumstances is where the Assessing Officer has refused to admit additional evidence, which ought to have been admitted.
In the instant case before us the assessee has pleaded that the assessee had filed such copy of confirmation of the some of the sundry creditors before the AO, however, there was some delay in collecting the confirmed copy of the ledger account from the 13 parties, which he could collect in last week of the December 2017 only.
When the assessee approached with those copies of the ledger accounts, the Assessing Officer refused to accept in view of the limitation of completing assessment was approaching. In our opinion, in view of the refusal by the AO for admission of those evidences, there was no option with the assessee except producing the same before the Ld. CIT(A).
CIT(A) has rejected admission of those evidences on the ground that the assessee did not file the said documents in the DAK of the said Assessing Officer. In our opinion, merely not filing those documents in the DAK counter of the Assessing Officer, the assessee cannot be denied substantial justice and examination of the said documents, which had been filed before learned CIT(A) immediately after filing of the appeal, following the rules provided in the Income-tax Rules.
We set aside the finding of the Ld. CIT(A) on the merit of the appeal and restore the matter to him with the direction to the admit the additional evidences filed by the assessee and thereafter decide the issue in dispute on merit after providing sufficient opportunity of being heard to both the parties i.e the assessee and the Assessing Officer. The relevant grounds of the appeal of the assessee are accordingly allowed for statistical purposes.
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2020 (7) TMI 9 - ITAT DELHI
Disallowance towards travelling expenses - Allowable business expenditure or personal expenditure - HELD THAT:- On a perusal of the details filed before the AO, it is seen that the assessee has given details of foreign visit expenses, which includes name and designations, country visited, TA-DA claimed, miscellaneous expenses, air fare, etc. These foreign travels have been for the trading purpose, conferences, training etc. Once the assessee has given very specific details of each and every employee, then without pointing out any specific discrepancy, no disallowance can be made. Apart from that, the reasoning given by the Ld. CIT (A), whether the presence of officials was required or not and how much that official has over stayed after completion of the official work is only based on presumption and surmise which cannot be upheld when the employees and directors were going official purpose. Being a PSU and under aegis of GOI, there cannot be an element of personal use of the company and therefore, such ad-hoc disallowance cannot be made and same is directed to be deleted. - Decided against revenue.
Disallowance u/s. 14A of the Act read with rule 8D - CIT - A deleted the addition - HELD THAT:- Both the parties agreed that there is no exempt income earned by the assessee. The Ld. Counsel submitted that whence there is no exempt income, then there is no question of disallowance of u/s. 14A. Now, it is a well settled proposition under the jurisdiction of Hon’ble jurisdictional Delhi High Court in view of CIT vs Cheminvest Ltd. [2015 (9) TMI 238 - DELHI HIGH COURT] and CIT vs Holcim India Pvt, Ltd. [2014 (9) TMI 434 - DELHI HIGH COURT] that when assessee has not earned any exempt income then no disallowance u/s 14A can be triggered. Therefore, the disallowance u/s 14A made by the AO sans any exempt income is deleted. - Decided against revenue.
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