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Income Tax - Case Laws
Showing 121 to 140 of 803 Records
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2016 (8) TMI 1425 - ITAT JAIPUR
Admission of additional evidence by CIT- A in deleting addition - Not giving proper opportunity of verification to AO thus violating the provision of Rule 46A(3) of the Income Tax Rules, 1962 - Disallowance of interest expenses on OD facilities and Disallowance u/s 14A - HELD THAT:- Department should be given proper opportunity to take into consideration the additional evidences for verification. After hearing both sides, we in the interest of justice and equity remand the issues raised in the Ground No. 1 and 2 of the Revenue to the file of the ld. CIT(A) to decide afresh after giving adequate opportunity of being heard to both the parties. Hence, the appeal of the Revenue is allowed for statistical purposes.
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2016 (8) TMI 1424 - ITAT HYDERABAD
Computation of deduction u/s 10A - exclusion both from export turnover as well as total turnover - HELD THAT:- See Sak Soft [2009 (3) TMI 243 - ITAT MADRAS-D] wherein it is held that communication charges attributable directly to the export of article or thing outside India has to be excluded both from export turnover as well as total turnover while computing exemption u/s 10A of the Act. In view of the ratio laid down as above, the finding of the DRP on this issue is upheld and ground raised by the Revenue is dismissed.
TP Adjustment - exclusion of comparables - HELD THAT:- No infirmity in the order of the DRP in directing the AO/TPO to exclude the companies from the list of comparables considering their advantageous brand value along with high turnover. Accordingly, this ground of appeal of revenue is dismissed.
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2016 (8) TMI 1423 - ITAT CHENNAI
TP adjustment - non adjustment against the custom duty component while determining the ALP - HELD THAT:- TPO has not considered the custom duty adjustment on the reason that it is equivalent to central excise in commercial market. This is not correct. The Tribunal consistently holding that while determining ALP, there should be suitable adjustment in respect of custom duty. Accordingly, we direct the A.O. to give suitable adjustment against the custom duty component while determining the ALP.
Air freight charges adjustment while computing the ALP - HELD THAT:- Assessee is in the field of manufacturing and testing of throttle body, rocker arm, solenoid valve, LPG gas mixer, vaporizer, LPG Tank etc. and the assessee has to transport the raw materials very urgently to meet the end of the customers. The assessee is importing the entire various components which is required to manufacture its final products. In the course, it incurred air freight charges, which is abnormal expenses and adjustments to be made while determining the ALP, as it is affecting the operating profits. The plea of the assessee is to be accepted, more so, following case of Transwitch India Pvt. Ltd. V. DCIT [2012 (5) TMI 314 - ITAT DELHI] wherein the adjustments towards abnormal expenses incurred by the assessee to be considered while determining the ALP. Accordingly, we direct the TPO to consider the same while determining the ALP.
Variation in exchange rate adjustment while determining the ALP - assessee entered into contract in adverse prices fixed on the prevailing exchange rate and due to fluctuation in exchange rate, there is loss and that exchange fluctuation to be considered while determining the ALP - HELD THAT:- It is normal that exchange rate is subject to fluctuation due to economic conditions. While determining the ALP, one has to consider these factors, more so, our view is fortified by cases of Honda Trading Corp. India Pvt. Ltd. V. ACIT [2013 (6) TMI 184 - ITAT DELHI] for the assessment year 2007-08 and DHL Express (India) Pvt. [2011 (4) TMI 856 - ITAT MUMBAI] for the assessment year 2006-07. Accordingly, we direct the TPO to provide considerable exchange fluctuation adjustment while determining the ALP - issue is remitted to the file of the TPO for determining the ALP after considering the above three components i.e. customs duty adjustment, air freight adjustment and foreign exchange fluctuation adjustment. - Appeal of the assessee is partly allowed for statistical purposes.
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2016 (8) TMI 1422 - RAJASTHAN HIGH COURT
Proceeding in case of non-operational/ dissolved / struck off company - Appeal filed by Department before High Court- - HELD THAT:- A communication issued from the office of Registrar of Companies, dt.7-4-2011 indicating that pursuant to sub-section(5) of Sec.560 of the Companies Act,1956 the name of Gopal Shri Scrips Pvt. Ltd, has been struck off from the Register and the said company is dissolved.
In the light of the communication placed for our perusal dt.7-4-2011, no purpose is going to be served in examining the substantial question of law which has been raised for consideration in the instant appeal and on account of these change in circumstances, the present appeal has become infructuouos and accordingly stands dismissed. The appellant is still at liberty to file application if any occasion arises in future.
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2016 (8) TMI 1421 - ITAT MUMBAI
Correct head of income - assessee have constructed commercial complex and rented out the unsold shops / offices on lease - Business income or income from house property - HELD THAT:- Assessee have constructed commercial complex and rented out the unsold shops / offices on lease. In case of Commissioner of Income Tax 12 Vs. M/s. Sane & Doshi Enterprises [2015 (4) TMI 882 - BOMBAY HIGH COURT] the income of the assessee was treated as income from house property. Finding identical facts and circumstances of the present case, we are of the view that in the present case the law is quite applicable and the income of the assessee is liable to be treated as income from the house property and accordingly he would be entitled exemption u/s.22 of the Act.
Set aside the finding of the CIT(A) in question and direct the Assessing Officer to re-assess the income of the assessee in view of the observation made above. - Decided in favour of assessee for statistical purpose.
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2016 (8) TMI 1420 - ITAT MUMBAI
Deemed dividend addition u/s 2(22)(e) - partners of the assessee-firm held more than 10% shares in both the companies as had received advances from the said companies and companies were having accumulated profits - provisions of section 2 (22)(e) were applicable in the case under consideration to the extent of committed profits retained by those companies - HELD THAT:- The assessee firm is not the share holder of the companies i.e. it is also a fact that in case of one of the companies the transactions were in the course of regular business-it was neither loan nor advance. As the assessee was not registered shareholder of the companies, so, the provisions of section 2(22)(e)were not applicable to it. SEE CIT v. Subrata Roy [2015 (3) TMI 767 - DELHI HIGH COURT]. -
TDS u/s 195 - Addition u/s 40(a)(ia) - payments were made to non-resident entities - PE in India - HELD THAT:- We are aware that the section 195 of the Act deals with the deduction of tax at source by the payer, i.e., the assessee, if the payments are to be made to a non- resident. The obligation to deduct the tax at source arises only when the payment is chargeable under the provisions of the Act-i.e. taxable in India. Facts of the case are that the assessee had made payments to non-resident agents, that the agents did not have PE in India, that the services were rendered outside India. In our opinion, considering these facts the assessee had rightly not deducted tax at source for making the payments to the non-resident agents.
Non-resident agent was only procuring orders for the assessee and following up payments and no other services were rendered, held that the non-resident agent did not provide any technical services to the assessee, that the commission payment made to the non-resident agent did not fall under the category of royalty or fees of technical services and, therefore, the Explanation to section 9(2) had no application to the facts of the assessee's case. The commission payments to the non-resident agents were not chargeable to tax in India and, therefore, the provisions of section 195 were not applicable.- Decided against revenue.
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2016 (8) TMI 1419 - ITAT MUMBAI
Gift of shares to company - transfer of capital - gift transaction - Applicability of provisions of section 56(vii)(a) - HELD THAT:- Equity interests are transferred by the assessee without consideration and it was a voluntary act. AO has not brought any adverse material against the above to conclude that the transactions involve the payment of consideration to the firm and the transfer of shares is not a voluntary act. In that sense, we find that the impugned Agreement dated 26.2.2010 has the required ingredients of the "gift" agreement. This view gets strength from the finding of Honble Ahmedabad High Court in the case of M/s. Prakriya Pharmachem vs. ITO [2016 (1) TMI 946 - GUJARAT HIGH COURT] and the related transfer of shares constitutes an exempt transfer under the provisions of section 47(iii) of the Act. We have also perused the order of Honble Bombay High Court in the case of the recipient company NECL [2014 (4) TMI 480 - BOMBAY HIGH COURT] during the Stay Petition related proceedings and find that the assessee's claim of gift agreement is prima facie approved. - assessee grounds are allowed.
Gift transaction is done only between the biological persons and not the firms and the companies - HELD THAT:- The decision of the Tribunal in the case of DP World (P) Ltd [2012 (10) TMI 444 - ITAT MUMBAI] KDA Enterprises [2015 (4) TMI 9 - ITAT MUMBAI] are relevant for the legal proposition that the gifts transferred by the Indian company to the foreign company constitutes a valid gift and the transfer is an exempt transfer u/s 47(iii) of the Act. Further, we accept the Counsel‟s proposition that share transfer by way of gift is allowable u/s 56(2)(viia) & 56(2)(viib) - assessee grounds are allowed.
Applicability of provisions of section 28(iv) of the Act. - HELD THAT:- These provisions imply the arising of any benefit / perquisite to the assessee-firm. On facts of the present case, we find, there is no such any benefit or perquisite to the assessee firm by transfer of shares of UPL and UEL to NCPL. Assessee is the transferor and gained nothing in the process. It is the finding of the CIT (A) that the assessee did not receive any consideration - assessee grounds are allowed.
Disallowing maintenance charges claimed as a deduction while computing income under the head income from house property - Municipal Taxes and maintenance charges and claimed deduction - HELD THAT:- Tribunal in the case of Sharimila Tagore [2004 (6) TMI 591 - ITAT MUMBAI] considered the non-occupation charges paid to the society has the "depressing effect" on the ALV in the hands of the land lord of the property. Assessee now wants similar deduction at the time of calculating the ALV and not the deduction u/s 24.
This appears to be a new argument raised by the Ld AR for the assessee. CIT (A) adjudicated this issue only from the point of view of section 24 and allowable deductions. In one view, this issue need re-adjudciation in the light of the new argument and the decision of the Tribunal (supra). Considering the above, we are of the opinion, this part of the ground needs to the remanded to the file of the AO for fresh adjudication. - Decided in favour of assessee for statistical purposes.
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2016 (8) TMI 1417 - ITAT MUMBAI
Arm's length price of interest at LIBOR+2% - whether it should be higher than LIBOR+2%, because the LIBOR is not the rate of consideration for loan transactions as it differs from country to country - Held that:- Referring to Tribunal in assessee company's own case, we direct the Assessing Officer to accept the interest rate charged at LIBOR+1% as an arm's length price.
Transfer Pricing Addition in respect of Corporate Guarantee - Held that:- Guarantee commission at the rate of 0.5% from its Associate Enterprise can be said to be at arms length. Thus, respectfully following the decision of Tribunal in assessee company`s own case, whereby issue were decided in favour of the assessee company. Accordingly, we direct the AO/TPO to compute and charge the guarantee commission at the rate of 0.5% from its Associate Enterprise.
Addition on account of adjustment in respect of interest on recharactarising share application money as Loan advanced to Associate Enterprise - Held that:- AR for the assessee company stated that the share application money can not be treated as loan amount merely because there is a delay in issuance of shares by the subsidiary in the name of the assessee. The assessee company further stated that the same identical issue is covered by the Hon`ble Mumbai Tribunal`s order in assessee's own case for A.Y. 2007-08. Share application money can not be treated as loan amount merely because there is a delay in issuance of shares by the subsidiary in the name of the assessee.
Addition in respect of interest and finance expenses related to acquisition of shares of foreign subsidiary and disallowance of the same under section 36 (1) (iii) - Held that:- Interest expenditure incurred by the assessee is out of commercial exigency of the business and hence should be allowed as business expenditure under section 36 (1) (iii) of the Act, and we accordingly direct the Ld. CIT (A) / AO to delete the addition for A.Y.2008-09.
Expenditure towards the foreign travel of its employees for expansion of its business acquired in Canada - Held that:- Since the foreign travel expenses are incurred by the assessee company in respect of the visit of its employees to overseas places in pursuance of its acquisition of call centre business in Canada and expanding the business thereof, the same should not be disallowed because all these expenses are related to business purpose and covered under the provisions of section 37 (1), therefore, we do not hesitate to direct the CIT (A) / AO to delete the said addition. In the result, appeal of the assessee is allowed on this ground.
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2016 (8) TMI 1416 - ITAT MUMBAI
Disallowance u/s. 14A r.w. Rule 8D - Held that:- AO has not recorded any dissatisfaction with reference to the maintenance of accounts and the expenses disallowed by the assessee for earning exempt income. AO has not recorded any reasons for not accepting the expenditure disallowed by the assessee for earning exempt income.
The funds available with the assessee are much more than the investments made during this Assessment Year. Therefore, in view of the submissions made before the Ld. CIT(A) that the funds available with the assessee are much more than the investments made by the assessee, we restore this issue to the file of the AO with a direction to verify as to whether the funds available with the assessee are more than the investments and in case the available funds are more than the investments, no disallowance is required to be made u/s. 14A r.w. Rule 8D(2)(ii) - Appeal filed by the assessee is allowed for statistical purpose.
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2016 (8) TMI 1415 - ITAT MUMBAI
Disallowance u/s 14A - Held that:- Tribunal directed the AO to restrict the disallowance u/s. 14A of the Act, to the exempt income earned by the assessee. In the process, the ITAT has considered all the relevant case law - National Thermal Power Co. Ltd. V. CIT [1996 (12) TMI 7 - SUPREME COURT], CIT v. Pruthvi Brokers and Shareholders Pvt. Ltd. [2012 (7) TMI 158 - BOMBAY HIGH COURT], Gujarat Gas Ltd. V. JCIT [2000 (4) TMI 19 - GUJARAT HIGH COURT] and Goetze (India) Ltd. V. CIT [2006 (3) TMI 75 - SUPREME COURT]
In view of the above, we direct the AO not to make any disallowance of interest u/s.14A read with rule 8D.
Facts and circumstances during the assessment year 2007-08 are pari material, therefore, following the above reasoning, we direct the AO to delete the disallowance of interest while computing disallowance u/s.14A r.w.rule 8D.- Decided in favour of assessee.
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2016 (8) TMI 1414 - SC ORDER
Entitlement for exemption in terms of Section 80P(2)(a)(i) - whether assessee are not a Co-operative Banks but a Co-operative Societies? - as per HC merely giving credit facilities to the members would not be a Co-operative Bank but continued to be a Co-operative Society and as there is no material on record that the respondents were giving any such credit facilities to the non members - Held that:- Delay condoned. Leave granted.
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2016 (8) TMI 1413 - ITAT KOLKATA
Addition u/s 68 - addition made towards share application money - identity, creditworthiness and genuineness of transaction - Held that:- All the share applicants are assessed to income tax and had regularly filed their income tax and ROC returns. Hence, the identity of the share applicants was duly proved. All the share applicants had made investments in share capital with the assessee company through account payee cheques from their disclosed bank accounts with sufficient sources which were duly explained. Hence, the genuineness of the transactions was also proved in the instant case.
We find that the assessee had even proved the source of source of share applicants in the instant case which are quite evident from the confirmations filed by them before the AO which are forming part of the records and the paper book. The share applicants had duly explained that they had liquidated their existing investments in shares of certain companies for which the proceeds were received by cheques and got deposited in their regular bank account.
From the said bank account, account payee cheques were issued to the assessee company towards investment in share capital by them. Hence the source of source for share applicants also is explained in the instant case by the assessee though it is not required to be proved by the assessee as per law. None of the documents pertaining to the share applicants which were filed before the AO were found to be ingenuine or non creditworthy by the AO. We find that the AO had made a wild allegation that these share applicant companies are mere paper companies without bringing any cogent material and evidences on record. - decided in favour of assessee.
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2016 (8) TMI 1412 - ITAT DELHI
Application of transfer pricing regulations on the Liaison Office of the assessee - addition made on account of Arm’s Length Price - Held that:- As decided in assessee'e own case [2010 (10) TMI 597 - ITAT, DELHI] Provision taxing of a non-resident U.K. company in a manner which is more burdensome vis-ŕ-vis an Indian company would lead to discrimination. This would also amount to unfavourable treatment being meted out to a U.K. company vis-ŕ-vis the Indian company doing identical business in India. Accordingly the assessee is entitled to protection of Art. 26 of the Indo-UK Treaty and should not have been subjected to tax on gross basis, but on net basis. The net profit was to be determined in accordance with the Indian Income Tax Act provisions for determining profits and gains of business from sections 28 to 43–B i.e. limits laid down in the domestic law of allowance of expenditure u/s. 30,31,32,36,37,40,43B etc would have to be taken in to account. In our view this is the purport of Article 7.5 read with Article 26 of the DTAA between India and UK - Decided in favour of the assessee.
Application of mark-up of 27.08% instead of 16.21% proposed by the TPO - Held that:- matter relating to the determination of Arm’s Length Price of the services rendered by the Liaison Offices was referred by the AO to the TPO who passed the order dated 18.01.2013 u/s 92CA(3) of the Act holding that Arm’s Length margin should be taken at 16.21% as against 15% in the earlier year of the cost incurred by the LO. However, the AO worked out the Arm’s Length Price by applying the mark-up of 27.08% instead of @ 16.21% of the cost and made the addition of ₹ 1,12,009/- by holding that income was to be added to the Liaison Offices costs incurred by the assessee, under transfer pricing provisions for the reason that the Liaison Offices had provided services to its head office. This issue is co-related with the issues raised in Ground Nos. 4, 5 and 7 to 11 which we have already adjudicated in the former part of this order in favour of the assessee, so it becomes academic in nature and hence dismissed
Treating of the receipts from operation & maintenance agreement (O&M) project of Godavari as FTS within the meaning of explanation-II to Section 9(1)(vii) of the Act and Article 13(4)(c) of the DTAA between India and UK and taxing the same on gross basis u/s 44D - Held that:- As decided in assessee's own case [2012 (5) TMI 806 - ITAT DELHI] assessee had also not “make available” any knowledge, skill etc. to M/s Spectrum within the meaning assigned to it under Article 13(4)(c) of the DTAA to FTS under the treaty. Accordingly, assessee cannot be taxed on gross basis and Section 44AD has no application to the facts of the instant case. Furthermore, Article 13(4)(c) read with Article 26 of DTAA does not permit the revenue authorities to discriminate against the assessee, a UK registered company and accord it less favourable treatment than a domestic company and therefore, section 44AD cannot be invoked in assessee’s case. Thus, looking from any angle, the income received by the assessee from M/s Spectrum was not a fee for technical services, we therefore direct the AO to compute assessee’s income and profit and gains of business from operation and maintenance of power plant of net profit and loss basis.
Assessee was making available technical knowledge, experience, skill, know-how or processes as per the provisions of Article 13(4)(c) of the DTAA to M/s SPGL under the O&M - Held that:- As decided in assessee's own case [2012 (5) TMI 806 - ITAT DELHI] The income so received for executing the work contract did not fall within the definition of FTS u/s 9(1)(vii) Explanation 2 of the IT Act nor as defined in Article 13(4) of DTAA between India and UK. The assessee had also not “make available” any knowledge, skill etc. to M/s Spectrum within the meaning assigned to it under Article 13(4)(c) of the DTAA to FTS under the treaty. Accordingly, assessee cannot be taxed on gross basis and Section 44AD has no application to the facts of the instant case. Furthermore, Article 13(4)(c) read with Article 26 of DTAA does not permit the revenue authorities to discriminate against the assessee, a UK registered company and accord it less favourable treatment than a domestic company and therefore, section 44AD cannot be invoked in assessee’s case. Thus, looking from any angle, the income received by the assessee from M/s Spectrum was not a fee for technical services, we therefore direct the AO to compute assessee’s income and profit and gains of business from operation and maintenance of power plant of net profit and loss basis.
Treating the other incomes from Godavari Operation & Maintenance Project as FTS and taxing the same on gross basis instead of net basis u/s 44D - Held that:- The identical issue relating to the treatment of the other income as FTS and taxing as business income on net basis u/s 44D of the Act has been decided for the assessment years 2007-08 and 2008-09 respectively held nterest received by the assessee in U.K. on bank accounts maintained in U.K. cannot be taxed in India. We find force in the submissions of the assessee as on the point of law there is no dispute between the assessee and the Revenue. The assessee has only current account in India and all the interest amount has arisen out of Bank accounts in U.K. and, therefore, the same should not have been subjected to tax in India at all. We allow this ground of appeal. The AO is directed to exclude interest earned outside India under Article 12(2) of the DTAA and tax interest earned in India as normal income. AO is at liberty to examine such interest income whether taxable as income from other sources or as business income.
Interest on foreign bank accounts accruing outside India - Held that:- The income so received for executing the work contract did not fall within the definition of FTS u/s 9(1)(vii) Explanation 2 of the IT Act nor as defined in Article 13(4) of DTAA between India and UK. The assessee had also not “make available” any knowledge, skill etc. to M/s Spectrum within the meaning assigned to it under Article 13(4)(c) of the DTAA to FTS under the treaty. Accordingly, assessee cannot be taxed on gross basis and Section 44AD has no application to the facts of the instant case. Furthermore, Article 13(4)(c) read with Article 26 of DTAA does not permit the revenue authorities to discriminate against the assessee, a UK registered company and accord it less favourable treatment than a domestic company and therefore, section 44AD cannot be invoked in assessee’s case. Thus, looking from any angle, the income received by the assessee from M/s Spectrum was not a fee for technical services, we therefore direct the AO to compute assessee’s income and profit and gains of business from operation and maintenance of power plant of net profit and loss basis.
Taxation of Foreign Exchange Fluctuation - Held that:- There is no dispute to the well settled legal proposition that if profit or loss on account of foreign exchange fluctuation arises out of capital assets, then it will be capital receipt and in case it arises out of trading business, then it should be treated as trading income. The AO is directed to verify the same and act accordingly.
Taxing the interest on Income Tax Refund @ 40% of gross basis - Held that:- In the present case, nothing is clear from the orders of the authorities below that what were the clauses in the DTAA between India and UK. The claim of the assessee that the said income was not connected to execution of any profit conducted during the year and was not connected to the PE of the assessee, however, in the absence of the clear facts on record, it is difficult to take a just decision. Therefore, we deem it appropriate to remand this issue back to the file of the AO to be adjudicated afresh in accordance with law after providing due and reasonable opportunity of being heard to the assessee.
Adjustment of unabsorbed brought forward losses, unabsorbed depreciation and the interest charged u/s 234B of the Act, we deem it appropriate to remand these issues to the file of the AO to be adjudicated after considering the relevant facts already available on the record and after providing due and reasonable opportunity of being heard to the assessee. - Appeal of the assessee is partly allowed and partly allowed for statistical purposes.
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2016 (8) TMI 1410 - ITAT CHANDIGARH
Penalty u/s 271(1)(c) - unexplained deposits on bank - addition on peak of one bank account and unexplained cheque deposits - Held that:- The Assessee is found have been depositing money into his bank account in cash as well as cheque for which the Assessee could not given adequate explanation and therefore such sum was found to be undisclosed income of the Assessee. The Assessee did not give complete name, address of those persons on account of whom he has obtained demand draft.
During the course of assessment proceedings the Assessee submitted that he is not in a position to supply all the names of the creditors. No such evidences were even filed during penalty proceedings also. Therefore in absence of any plausible explanation the Assessee is found to have concealed the particulars of his income as he has failed to offer explanation which he is not able to substantiate and further has failed to prove that such explanation is bonafide and that the relevant and material facts relating to the computation of income. In view of these facts the provision of section 271(1)(c) gets attracted correctly. See MAK DATA P. LTD.case [2013 (11) TMI 14 - SUPREME COURT] - decided against assessee.
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2016 (8) TMI 1409 - ITAT AMRITSAR
Net profit rate at 7% on the gross receipts - Held that:- The assessee is a civil contractor and the total receipts amounting to ₹ 9,96,62,747/- were shown during the year under consideration thereby showing the rate of profit @ 4.61%. AO took the net profit at ₹ 99,66,275/- after applying 10% rate to the total receipts. Against this the salary to partners was allowed and the net income was determined at ₹ 79,66,275/-.
Against the said addition the assessee went in appeal before the ld. CIT(A) and the ld. CIT(A) applied a net profit at 7% on the gross receipts declared by the assessee. It was also held that the deprecation as claimed at ₹ 2,13,22,380/- may be allowed. While allowing the depreciation the CIT(A) relied upon the decision in the case of Lali Construction Co. vs. ACIT [2014 (9) TMI 500 - PUNJAB & HARYANA HIGH COURT] in which, it was observed that the depreciation allowable from net profit even if the total income is computed by applying net profit rate. Several other Courts have also held the same view.
Provisions of section 40a(ia) are not applicable as this amount has been shown in the hands of the receipt ant and which has suffered tax. As such the disallowance is not called for and the department has got no justification for coming in appeal before the Tribunal.
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2016 (8) TMI 1408 - BOMBAY HIGH COURT
Payment made to ex-partners as allowable deduction - Held that:- It is an agreed position between the parties that the question proposed by the Revenue in the appeal stands concluded against the Revenue and in favour of the respondent assessee by the decision of this Court in (i) Commissioner of Income Tax Vs. Kanga & Co. (2016 (2) TMI 573 - BOMBAY HIGH COURT), Commissioner of Income Tax Vs. Mulla & Mulla and Craigie, Blunt and Caroe [1990 (9) TMI 32 - BOMBAY HIGH COURT] and Commissioner of Income Tax Vs. M/s. C.C. Chokshi & Co. (2013 (2) TMI 872 - BOMBAY HIGH COURT). No substantial question of law.
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2016 (8) TMI 1407 - ITAT DELHI
Addition of undisclosed income in his statement recorded u/s 132(4) - Held that:- It is clear that there is no material or corroborative evidence to support the statement made under section 132(4) of the Act in respect of the addition of ₹ 30 lakh against unexplained investment in stock and ₹ 23.20 Lacs against the unexplained expenditure. The assessee did not admit the addition, which means, he retracted the said surrender in the return of income filed.
We find that the Tribunal in the case of best infrastructure (India) Private Limited (2016 (5) TMI 1298 - ITAT DELHI) and case of Harjeev Aggarwal (2016 (3) TMI 329 - DELHI HIGH COURT) have in the similar facts and circumstances, held that no addition can be made merely on the statement recorded under search and seizure proceedings on a standalone basis without any supporting or corroborative material - thus order passed by the CIT(Appeals) on the issue in dispute is well reasoned and no interference on our part is required, accordingly, we uphold the finding of the CIT (Appeals) on the issue in dispute. Thus, ground No. 1 and 2 of the appeal are dismissed.
Adjudication of appeal without filing of the statement of fact as mandated by the statutory form No. 35. - Held that:- CIT(A) has not treated the forms filed before him as defective. He admitted the appeal and adjudicated the matter on merits. The order of the CIT(A) is the impugned order appealed against before us. The ld. DR wants us to hold that the order of the ld. CIT(A) is illegal and against the law as there is a defect in Form No. 35 In our view the arguments raised by the ld. DR are devoid on merit. Defects in the return of income filed, defects on Form No. 35 which is the form of appeal etc. are to be considered by the respective authorities before whom these are filed and the maintainability of the appeal before us cannot be challenged. The right of appeal is a substantive right. Procedural issues can not take away substantial rights of a person. This cannot be a ground for the revenue to challenge the order of the ld. CIT(A) which is in this case in favour of the Revenue. The arguments to say the least are farfetched. Hence we dismiss the same.- decided against revenue
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2016 (8) TMI 1406 - ITAT DELHI
Validity of reopening of assessment u/s 147 - eligible reasons to believe - non independent application of mind by AO - borrowed knowledge - Held that:- AO has not applied his mind so as to come to an independent conclusion that he has reason to believe that income has escaped during the year - the reasons are vague and are not based on any tangible material as well as are not acceptable in the eyes of law.
AO has mechanically issued notice u/s. 148 on the basis of information allegedly received by him from the DIT (Investigation), New Delhi. Thus the reopening in the case of the assessee for the AY in dispute is bad in law and deserves to be quashed. See Pr. CIT vs. G&G Pharma India Ltd. [2015 (10) TMI 754 - DELHI HIGH COURT]. - Decided in favour of assessee.
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2016 (8) TMI 1405 - ITAT LUCKNOW
Accumulation of income u/s. 11(2) - Held that:- As find that assessee has given a notice of accumulation of funds, but the AO did not take cognizance of this fact and has made the addition; whereas the CIT(Appeals) has examined the issue in detail in the light of various judicial pronouncements and since find no infirmity in the order of CIT(Appeals), thus confirm the same.
Disallowance of depreciation claimed by the assessee trust - Held that:- CIT(Appeals) has decided the issue in the light of judgments of various High Courts in which it has been held that depreciation is exhaustion of effective life of a fixed asset owing to its ‘use’ or obsolescence. It is computed as part of the cost of asset which will not be recovered when the asset is put to use. Even the Hon’ble Bombay High Court has held that depreciation should be allowed even on assets received on transfer on which no cost was borne by the assessee trust. CIT(Appeals) has properly adjudicated the issue and no interference is called for. - Decided against revenue
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2016 (8) TMI 1404 - SC ORDER
Reopening of assessment - validity of notice - non-issuance of service of notice - Held that:- Special leave petitions are dismissed as not pressed.
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