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Income Tax - Case Laws
Showing 21 to 40 of 571 Records
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2021 (1) TMI 1267 - ITAT DELHI
Vivad Se Vishwas scheme 2020 - assessee requested for adjournment of the case on the ground that assessee has opted for the Vivad Se Vishwas scheme 2020 and Form No. 3 is still awaited - HELD THAT:- As captioned appeal is consigned to record and treated as dismissed. However, the aforesaid is subject to a caveat that in case the dispute relating tax arrears for the captioned assessment year is not ultimately resolved in terms of the aforesaid scheme, the assessee shall be at liberty to approach the Tribunal for reinstitution of the appeal and the Tribunal shall consider such application appropriately as per law. The Revenue has no objection with regard to the aforesaid caveat.
Appeal of the assessee is consigned to record and for statistical purposes is treated as dismissed.
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2021 (1) TMI 1266 - ITAT DELHI
TP Adjustment - adjustment qua AMP expenses - ALP of AMP expenses - HELD THAT:- We are of the considered opinion that the ALP of an international transaction involving AMP expenses, the adjustment made by the TPO/DRP/AO is not sustainable in the eyes of law. We cannot ignore the submission of the DR that the matter is pending before Hon'ble Apex Court and the decision of Hon'ble Apex Court would be binding upon all the authorities. We set aside the orders of authorities below and restore the matter to the file of the AO.
We hold that as per the facts of the case and the legal position as of now and discussed above in this order, the adjustment made by the TPO/DRP/AO in respect of AMP expenses is not sustainable. If the above decisions of Hon'ble Jurisdictional High Court which is under consideration before the Hon'ble Apex Court is modified or reversed by the Hon'ble Apex Court, then the Assessing Officer would pass the order afresh considering the decision of Hon'ble Apex Court. In those circumstances, he will also allow opportunity of being heard to the assessee.
We are of the considered view that following the law laid down in Sony Ericsson Mobile Communications India Pvt. Ltd.[2015 (3) TMI 580 - DELHI HIGH COURT] adjustment made by the TPO/DRP/AO on account of ALP of AMP expenses is not sustainable in the eyes of law, hence deleted. So, the appeal filed by the taxpayer is allowed and the appeal filed by the Revenue is dismissed.
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2021 (1) TMI 1261 - GUJARAT HIGH COURT
Dismissal of appeal on non prosecution - Tribunal dismissed the appeal on the ground of the nonappearance of the writ applicant - HELD THAT:- As learned council seeks to rely on Rule 24 of the Income Tax Rules, 1963 which makes it abundantly clear that the tribunal cannot dismiss the appeal without adverting to the merits. Even on the day on which the hearing is adjourned, the appellant chose not to appear in present or through an authorized representative. It would incumbent upon the tribunal to dispose of the appeal on merits. Mr. Dave, the learned counsel seeks to rely on the decision of this High Court in the case of Sanket Estate & Finance (P.) Ltd. [2012 (12) TMI 991 - GUJARAT HIGH COURT].
Let Notice be issued to the respondents for final disposal, returnable on 10/02/2021. On the returnable date, notify the matter on top of the board.
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2021 (1) TMI 1260 - GUJARAT HIGH COURT
Disallowance u/s. 14A of the Act r.w. Rule 8D - HELD THAT:- The first question is covered by a decision of this Court in the case of CIT Vs. Corrtech Energy Pvt. Ltd. [2014 (3) TMI 856 - GUJARAT HIGH COURT] The view taken therein is that, when the assessee has not made claim for exemption in the income from payment of tax in disallowance could be made under Section 14A of the Act.
Addition on account of disallowance u/s. 14A r.w Rule 8D while computing Book Profit u/s. 115JB - HELD THAT:- The second question would also not survive once the view is taken that there could not have been any disallowance under Section 14A read with Rule 8D of the Act. In such circumstances, there is no question of computing the Book Profit under Section 115JB of the Act. In other words, the expenses incurred to exempt the income cannot be added for computing the Book Profit under Section 115JB of the Act.
We may clarify that since the disallowance under Section 14A itself has been deleted, therefore, there is no question of adding back under Section 115JB
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2021 (1) TMI 1253 - ITAT MUMBAI
Rectification u/s.254(2) - additional ground raised in respect of deduction claimed on account of education cess which was dismissed by the Tribunal while passing its order as not an allowable expenditure - HELD THAT:- We find that this Tribunal admittedly while disposing off its appeal and more particularly in the additional ground raised in respect of deduction claimed on account of education cess, had inadvertantly lost sight of the decision of the Hon’ble Rajasthan High Court [2018 (10) TMI 589 - RAJASTHAN HIGH COURT] and other Tribunal decisions quoted by the assessee on the impugned issue and had rendered its decision.
We are also inclined to accept to the proposition of the ld. Counsel for the assessee that when there is a particular decision of the Hon’ble Jurisdictional High Court which was rendered subsequent to the order passed by the Tribunal, the same would constitute mistake apparent from record within the meaning of Section 254(2) of the Act which is amenable to rectification thereon. It is also a fact that the Hon’ble Jurisdictional High Court in the case of Sesa Goa Ltd.[2020 (3) TMI 347 - BOMBAY HIGH COURT] decided the issue raised in the additional ground in favour of the assessee by holding that the education cess would be entitled for deduction as expenditure. Hence, respectfully following the said decision and in view of various other decisions relied upon by the ld. Counsel for the assessee referred to supra, we direct the ld. AO to grant deduction on account of education cess and allow the additional ground raised by the assessee for the A.Y.2007-08 in its entirety. Accordingly, the order passed by this Tribunal in this regard disposing off the additional ground stands modified. Miiscellaneous Application of the assessee for A.Y.2007-08 is allowed.
Non-adjudication of additional grounds as constitute mistake apparent on record warranting rectification u/s.254(2) - additional grounds raised by the assessee on account of claiming deduction of expenditure in respect of Employee Stock Option Plan (ESOP) and deduction in respect of education cess were not at all adjudicated by this Tribunal while disposing off its appeal - HELD THAT:- We find that the additional grounds raised on the aforesaid two issues for A.Y.2008-09 have not been adjudicated by this Tribunal while disposing off the original appeal which is amenable to rectification u/s.254(2) of the Act.
With regard to deduction claimed in respect of education cess, we have already held for the A.Y.2007-08 in this order supra that the assessee would be entitled for deduction in respect of education cess. We direct the ld. AO accordingly to grant deduction for the same for A.Y.2008-09 also.
With regard to deduction claimed in respect of Employee Stock Option Expenditure, since the said issue was not at all adjudicated by the Tribunal, we hereby recall the order passed by this Tribunal for A.Y.2008-09 only for the limited extent of adjudication of this additional ground alone. Miscellaneous Application of the assessee for A.Y.2008-09 is allowed.
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2021 (1) TMI 1251 - MADRAS HIGH COURT
Benefit of Vivad Se Vishwas Scheme - assessee submit that the assessees have already filed the declaration/undertaking under the Vivad Se Vishwas Scheme on 01.12.2020 and is awaiting orders to be passed in Form No.3. - HELD THAT:- In the light of the subsequent event, the Competent Authority shall process the applications/declaration in accordance with the Direct Tax Vivad Se Vishwas Act, 2020 (Act 3 of 2020) and pass appropriate orders as expeditiously as possible. The assessees are given liberty to restore these appeals in the event the ultimate decision to be taken on the declaration filed by the assessee under Section 4 of the said Act is not in favour of the assessees. If such a prayer is made, the Registry shall entertain the prayer without insisting upon any application to be filed for condonation of delay in restoration of the appeals and on such request made by the assessees by filing a miscellaneous petition for restoration, the Registry shall place such petition before the appropriate Division Bench for orders.
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2021 (1) TMI 1246 - SC ORDER
Reopening of assessment u/s 147 - notice in the company name being amalgamated - As per HC if the company has ceased to exist as a result of the approved scheme of amalgamation then in that case, the jurisdictional notice issued in its name would be fundamentally illegal and without jurisdiction. It is also held that upon the amalgamating entity ceasing to exist, it cannot be regarded as a person under subsection (31) of section 2 of the Act; against whom assessment proceedings can be initiated - HELD THAT:- Tax effect is below the threshold of ₹ 25 lakhs contained in the relevant circular of the Central Board of Direct Taxes.
The Special Leave Petition is, therefore, not entertained and it is dismissed accordingly.
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2021 (1) TMI 1244 - ITAT AHMEDABAD
Disallowance u/s 14A r.w.r. 8D - expenditure incurred on exempt income - HELD THAT:- CIT(A) has mentioned in his order that issue is covered by the decision given by his office in appellant own case for A.Y. 2012-13 [2019 (10) TMI 1504 - ITAT AHMEDABAD]wherein he has restricted the confirmed exempt income of the assessee.
In our considered opinion, we do not find any infirmity in the order passed by the Ld. CIT(A). Hence, we confirm the order of the ld. CIT(A) and same does not require any kind of interference at our end.
Late delivery charges disallowance - allowable business expenditure - HELD THAT:- As decided in own case [2018 (12) TMI 182 - ITAT AHMEDABAD] there is no dispute that apportion of the sale consideration was retained by the payees on account of /ate delivery of the machineries and as per the terms of contract, the assessee had to compensate the customers if it fails to deliver the goods on time. There is no dispute that such expenditures were incurred during the ordinary course of the business of the assessee and therefore are directly related to the business activity of the assessee. It is also true that these expenditures are not penalty levied for any infraction of any legislated law of the land but has been incurred out of a contractual obligation. In our considered opinion, such expenditures are definitely of revenue in nature and are allowable u/s. 37 of the Act. Appeal of assessee allowed.
Disallowance of foreign commission u/s 40(a)(ia) - Commission paid to non-resident whose income is not taxable in India and all services rendered outside India and it has not permanent establishment or office of agent in India - HELD THAT:- As decided in own case [2018 (12) TMI 182 - ITAT AHMEDABAD] Section 9 of the act provides for the income deemed to accrue or arise in India. It is noticed that no income is deemed to accrue or arise in India by applying the provisions of section 9 (l)(i) as the assessing officer has failed to establish accruing or arising of any income from business connection in India or through or from any property or through the transfer of a capital asset situated in India. We observe that there was no material which can demonstrate that any of the agents had any Permanent Establishment in India as all the agents had their establishments situated in the overseas places. In the lights of the above facts and detailed findings of the Ld.CIT(A) it is clear that the Provisions of section 9 (1)(i) cannot be applied, therefore we consider that the CIT(A) has rightly deleted the impugned disallowance of commission payment made to the foreign agents. In the result the appeal of the revenue is dismissed.
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2021 (1) TMI 1242 - ITAT DELHI
Disallowance u/s 14A r.w.r. 8D - HELD THAT:- It is quite evident that, firstly, assessee had own substantial fund for making the investment; and secondly, the assessee had duly explained and demonstrated that the loan funds could not have been utilized for the purpose of investment. Under these circumstances, the disallowance of interest under Rule 8D (2)(ii) cannot be made and has been deleted by the ld. CIT(A).
As decided in own case [2018 (5) TMI 1021 - ITAT DELHI] assessee has kept all the funds in one common pool, the presumption that the investment has been made from interest bearing funds cannot be appreciated, since for the year under consideration assessee has substantially demonstrated before Ld.CIT(A) regarding sufficient funds being available for investment purposes other than the interest/bearing funds which has not been refuted by Ld. CIT-D.R. CIT(A) has observed that the funds are to be strictly utilised by assessee as per guidelines issued by RBI - submissions advanced by Ld. Counsel regarding there being no details that was filed by assessee in order to demonstrate the non-utilisation of interest bearing funds for the purpose of investments that could yield dividend income. - Decided in favour of assessee.
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2021 (1) TMI 1239 - JHARKHAND HIGH COURT
Penalty u/s 271(1)(c) - petitioner did not disclose the income out of sale consideration in his return or otherwise before the Department prior to the case being selected for scrutiny - petitioner failed to disclose the income arising out of transfer of long terms capital assets to the tune of ₹ 59,49,000/- in the return filed in the A.Y. 2014-15 despite the sale of his landed property at Bokaro through registered sale on 24.06.2013 i.e., in the F.Y. 2013-14 - HELD THAT:- Petitioner had not disclosed his assets before the income tax department in any of the preceding three assessment years. It was only upon perusal of CIB information extracted from ITD application that it was found that he had sold immovable property of ₹ 59,49000/-but neither the sale consideration nor capital gains was shown by him in the return filed in the A.Y. 2014-15. In those circumstances his case was selected for scrutiny under CASS for assessment. During the course of assessment, petitioner filed a calculation sheet claiming exemption instead of filing a revised return disclosing income arisen from transfer of long terms capital asset due to transfer of his landed property at Bokaro through registered sale deed dated 24.06.2013. It is well settled that such additional claim cannot be made before the assessing officer under the Act to make an amendment in the return without filing a revised return.
This Court in the facts and circumstances of the present case, noted above, finds that there is lack of bonafides on the part of the petitioner. On the one hand, he has not disclosed the assets in any of the returns of three previous years to the year i.e. F.Y 2013-14 corresponding to A.Y. 2014-15. On the other hand, after his case being taken up for scrutiny, without filing the revised return, he sought to raise additional claim for exemption under section 54 F of the Act by filing calculation sheet before the Assessing Officer which was rightly denied in the light of the decision Goetze (India) Limited [2006 (3) TMI 75 - SUPREME COURT] - He straightaway approached the Revisional Authority. Before the Revisional Authority, he failed to appear despite repeated notices. Given the limited scope of revisional power, the Commissioner, Income Tax considering the grounds urged by the petitioner and upon analysis of the findings recorded by the Assessing Officer, did not find any illegality, irregularity or incorrectness in the findings on the basis of the materials on record. Being aggrieved by the order of the Revisional Authority, the writ petitioner has approached this Court in writ jurisdiction.
Upon consideration of the submissions of the learned counsel for the parties and upon analyzing the relevant materials on record including the findings recorded by the Assessing Officer and the Revisional Authority in the light of the decisions referred to hereinabove and relied upon by the parties, we do not find any error in law or on facts warranting interference in the impugned orders in exercise of writ jurisdiction.
Alternative remedy has been raised against the order imposing penalty as is available under Section 246 A(1)(i)(B) - Petitioner however submits that petitioner may be allowed liberty to assail the order of penalty before the Appellate Authority under Section 246(1)(i) (B) of the Act. We may observe herein that this Court has refused to interfere in the order of the Assessing Authority and the Revisional Authority on consideration of the grounds available under the powers of judicial review. We however leave it to the petitioner to approach the Appellate Authority, as per the provisions under the Income Tax Act, 1961 against the order of penalty dated 26.09.2018 (Annexure-9) passed by the respondent no.3- Assessing Officer under Section 271(1) (c) of the Act, if permissible in law. It is made clear that the Appellate Authority may consider the plea of the petitioner uninfluenced by any of the observations of this Court hereinabove. WP dismissed.
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2021 (1) TMI 1233 - ITAT CHANDIGARH
Late payments towards EPF and ESI u/s 36(1)(va) - deposits prior to filing of the return of income u/s. 139(1) - HELD THAT:- As relying on RAJA RAM VERSUS THE ITO, WARD 3 AND SANCHI MANAGEMENT SERVICES PRIVATE LIMITED [2021 (11) TMI 370 - ITAT CHANDIGARH] the impugned additions made by the Assessing Officer and sustained by the Ld. CIT(A) on account of deposits of employees contribution of ESI & PF prior to filing of the return of income u/s. 139(1) of the Act, in both the years under consideration prior to the amendment made by the Finance Act, 2021 w.e.f. 1.4.2021 vide Explanation 5, are deleted. - Decided in favour of assessee.
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2021 (1) TMI 1226 - ITAT MUMBAI
Admission of additional evidence by CIT-A - As per AO evidences not been forwarded to the AO to examine & verify the same and thereby violated the provisions contained under Rule 46A(3) of IT Rules, 1962 - HELD THAT:- Since the evidence entertained by Ld. CIT(A) during the appellate proceedings has not seen the light of the day during assessment proceedings and AO has never been given an opportunity to look into and verify the facts taken in the additional evidence, the order passed by the Ld. CIT(A) is not sustainable, hence liable to be set aside.
Consequently, case is remitted back to the AO to decide afresh, in the light of the directions issued by the co-ordinate Bench of the Tribunal BAJAJ ENERGY LTD (FORMERLY KNOWN AS BAJAJ ENERGY PVT. LTD.) [2017 (10) TMI 1595 - ITAT MUMBAI] after providing opportunity of being heard to the parties. Appeal filed by the Revenue is allowed for statistical purposes.
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2021 (1) TMI 1224 - ITAT CHANDIGARH
Late deposit of employees shares of Provident Fund (PF) - Contributions deposited after the due date but before the due date of filing of return of income - HELD THAT:- As relying on RAJA RAM VERSUS THE ITO, WARD 3 AND SANCHI MANAGEMENT SERVICES PRIVATE LIMITED [2021 (11) TMI 370 - ITAT CHANDIGARH] impugned additions made by the Assessing Officer and sustained by the Ld. CIT(A) on account of deposits of employees contribution of ESI & PF prior to filing of the return of income u/s 139(1) of the Act, in both the years under consideration prior to the amendment made by the Finance Act, 2021 w.e.f. 1.4.2021 vide Explanation 5, are deleted. - Decided in favour of assessee.
Educational Cess being deductible expenditure - HELD THAT:- This issue is covered in assessee's favour by the judgment of the Hon'ble Bombay High Court in the case of Sesa Goa Ltd. Vs. JCIT, [2020 (3) TMI 347 - BOMBAY HIGH COURT] has held that since the term “Cess” is not included in clause (ii) of section 40(a)of the I.T. Act, 1961, there is no prohibition in claiming the same as a deduction in computing income chargeable under head of profits and gains of business or profession.
Education cess is not a disallowable expenditure under section 40(a)(ii) - we are of the considered opinion that education cess and secondary education cess paid on income tax is an allowable expenditure. Ground raised by the assessee is allowed.
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2021 (1) TMI 1218 - ITAT BANGALORE
Capital gain computation - date of transfer of asset - execution of the JDA - amount assessed for the purposes of stamp duty be considered as Sale Consideration for the purposes of computation of capital gains - scope of amendment to section 50C - whether the CIT(Appeals) was right in holding that amendment to section 50C of the Income-tax Act, 1961 [the Act] which was introduced w.e.f. AY 2007-08 was applicable retrospectively for AY 2014-15 when the language used in the proviso does not indicate that it was inserted as a clarification? - HELD THAT:- JDA was executed on 1.3.2013. MoU was entered on 8.4.2013. The guidelines value was revised on 12.8.2013. According to the assessee, transfer took place on the date of JDA on 1.3.2013 and the relevant value as on the date of JDA or the date of MoU to be applied, instead of applying guidelines value on 12.8.2013 in view of the proviso to section 50C(1) of the Act.
There was payment of ₹ 2,50,00,000 on 23.11.2011 by cheque No.259865 drawn on Vijaya Bank, Sarakki Branch, Bangalore. Being so, the argument of the ld. DR is that MoU is not suggesting any payment so as to apply the proviso to section 50C, thus it is deemed retrospective in nature. In our opinion, as held by the Madras High Court in the case of Vummudi Amarendran [2020 (10) TMI 517 - MADRAS HIGH COURT], proviso to section 50C(1) is retrospective in nature applicable from AY 2014-15. Further part of the consideration has already been passed through MoU as enumerated above. It cannot be said that no consideration is paid on the date of MoU. This finding of the lower authorities is not proper. Accordingly, we hold that proviso to section 50C(1) by the Finance Act, 2016 is retrospective and also the assessee proved that the 2nd proviso to section 50C(1) is satisfied since the assessee has paid a part of sale consideration on the date of such MoU dated 8.4.2013. In view of this, we hold that the guidance value has to be computed as prevailing on the date of MoU dated 8.4.2013. Appeal of assessee allowed.
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2021 (1) TMI 1215 - ITAT BANGALORE
Transfer pricing adjustment made in respect of "Engineering Design Segment" - non-USA related transactions - HELD THAT:- USA related transactions constituted 96.30% of the total turnover of EDS segment for margin was agreed to be 15.85% under MAP resolution. The coordinate bench has taken the view that the same rate may be adopted for non-USA related transactions also in the assessee's own case relating to 2008-09[2021 (7) TMI 84 - ITAT BANGALORE] - Accordingly, following the decision rendered by the coordinate bench in AY 2008-09, we direct the AO/TPO to adopt the margin of 15.85% to non-USA related transactions also under engineering design services segment.
Transfer Pricing adjustment made in respect of "Marketing Support Services" - Comparable selection - HELD THAT:- We notice that M/s. Asian Business Exhibition & Conferences Ltd. and ICC international Agencies Ltd. have been directed to be excluded by the coordinate bench in the case of Electronic Imaging India Pvt. Ltd. [2017 (7) TMI 1335 - ITAT BANGALORE]. Following the above decision, we direct exclusion of both these companies.
After exclusion of the above said 2 companies, only M/s. Cyber Media Research Ltd. would remain. The TPO may determine the sufficiency or otherwise of one comparable company after considering the facts of the case and after hearing the assessee.
Working capital adjustment is supported by the decision of coordinate bench in the case of Huawei Technologies India Pvt. Ltd. [2018 (10) TMI 1796 - ITAT BANGALORE] we direct the A.O. to allow working capital adjustment on actual basis.
Disallowance u/s. 40(a)(ia) in respect of broad band connectivity charges - HELD THAT:- As decided in own case[2021 (7) TMI 84 - ITAT BANGALORE]we direct the A.O. to delete the disallowance of broadband charges made u/s. 40(a)(ia) as held assessee has simply obtained broadband/Internet facility from the service provider M/s. Tata Indicom. It is not a case where a service contract has been entered into. The facility is open to all and sundry and any member of the public can avail of it. In such circumstances, the view of the AO that the nature of service rendered as an element of implicit contract is struck down and therefore, the addition cannot be sustained in first appeal.
Disallowance u/s. 40(a)(ia) of depreciation claimed on software purchases for non-deduction of tax at source - as submitted by Ld. A.R., depreciation is not an item included u/s. 40(a)(ia) of the Act and hence the depreciation cannot be disallowed - HELD THAT:- We find support by this proposition on the decision rendered by the coordinate bench in the case of UKN Properties Pvt. Ltd.[2021 (7) TMI 106 - ITAT BANGALORE] - Accordingly, the disallowance of depreciation u/s. 40(a)(ia) of the Act is liable to be deleted. The Ld. DRP however has directed the A.O. to treat software purchases as revenue expenditure and disallow the same u/s. 40(a)(ia) of the Act. In this regard, the Ld. CIT(A) has followed the decision rendered in the case of Samsung Electronics Company Ltd.[2011 (10) TMI 195 - KARNATAKA HIGH COURT] which has since been reversed by Hon'ble Supreme Court in the case of Engineering Analysis Centre of Excellence Pvt. Ltd. [2021 (3) TMI 138 - SUPREME COURT] Accordingly, in our view, the disallowance of entire amount of software purchases u/s. 40(a)(ia) of the Act treating the same as revenue expenditure requires fresh examination at the end of the A.O
Business profits eligible for deduction u/s. 10A of the Act - A.O. had taken the view that the expenses deducted from export turnover cannot be deducted from the total turnover for the purpose of computation of deduction u/s. 10A - HELD THAT:- DRP directed the Assessing officer to deduct the expenses from total turnover also following the decision rendered by jurisdictional Hon'ble Karnataka High Court in the case of Tata Elxsi Ltd. [2011 (8) TMI 782 - KARNATAKA HIGH COURT]. The above said decision of Hon'ble High Court has since been upheld by Honourable Supreme Court in the case of HCL Technologies Ltd.[2018 (5) TMI 357 - SUPREME COURT]. Accordingly, we do not find any infirmity in the direction given by Ld. DRP.
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2021 (1) TMI 1205 - CALCUTTA HIGH COURT
Exemption u/s 11 - registration under Section 12AA denied - dissolution clause was not found and/or available in the Deed of Trust - HELD THAT:- As stating that the Trust is a public charitable trust, the immovable property has been set apart for a temple at Haridwar for the general public and no trustee or the Trust are there related or entitled for any profits from the assets and usufructs of the Trust and the Trustee has passed a resolution stating therein that in the event of dissolution of Trust, all available funds including the immovable and movable assets of the Trust to be handed to any other Trust having similar objects and operating within the Union of India. Further, if no such Trust is found, the property shall be vested to the Government.
This resolution was annexed as Annexure No. IV to the grounds. Tribunal after considering the factual position and on examining the records placed before it allowed the appeal filed by the assessee. We find that there is no error in the order passed by the Tribunal. As already pointed out the CIT(E) did not doubt the genuineness of the activities of the Trust but merely stated that dissolution clause was not found and/or available in the Deed of Trust. The order passed by the CIT(E) dated 4th November, 2015 is a non-speaking order. Had the CIT(E) examined the entire records including the resolution passed by the Trust which came into being as early in the year 1944 then in all probability the application would not have been rejected. - Decided against revenue.
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2021 (1) TMI 1201 - ITAT JODHPUR
Estimation of business income - Invoking the provisions of section 145(3) - CIT(A) justification in directing AO to apply the position of profits after interest but before depreciation in the year under appeal and in preceding year - HELD THAT:- The estimation of income from business had been made after considering the various aspects of the case - also considered the reasonable of gross profit rate and the allowance of various indirect expenses, interest and depreciation. The second issue of the revenue with regard to allowability of depreciation has also been decided. Thus, we don’t find any merit in the present appeal of the revenue and dismiss both the grounds of appeal raised in the Revenue appeal.
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2021 (1) TMI 1160 - CALCUTTA HIGH COURT
Maintainability of appeal - Monetary limit to make an appeal before High court - HELD THAT:- In view of Circular No.17/2019 F.No.279/Misc.142/2007-ITJ(Pt.) issued by Government of India, Ministry of Finance, Department of Revenue, Central Board Direct Taxes, Judicial Section dated August 8, 2019, monetary limit for filing appeals before the High Court has been increased to ₹ one crore and the tax effect in the present appeal being less than that, he may be permitted to withdraw the present appeal.
Appeal is dismissed as withdrawn, while keeping open the legal issue raised therein.
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2021 (1) TMI 1154 - ITAT MUMBAI
Claim u/s 80IA in respect of parking lot developed on CIDCO land at truck terminal - assessee submitted before the AO that it has developed parking lot with access road at truck terminal, Kalamboli, Navi Mumbai on BOT basis and is responsible for repair, maintenance and operation of the said parking lot - HELD THAT:- In this case the assessee was awarded a project by CIDCO to construct a parking lot called truck terminal having facilities on BOT basis. Under the terms of award, the assessee was responsible for repair, maintenance and operation of the said terminal.
The assessee used to collect fee from the truck owners from the trucks and also pay yearly fee to CIDCO. According to the AO the assessee is not eligible for deduction under section 80IA of the Act on the ground that the truck terminal is not an infrastructure facility which was affirmed by Ld. CIT(A) in the appellate order. According to the revenue authorities the truck parking terminal is an independent contract with CIDCO which has nothing to do highways.
Whether the truck terminal is an integral part of highways or not? - We note that Finance Act, 2001 has modified the definition of infrastructure facility which means a highway project including housing or other activities being an integral part of the highway project. It is clear from the amended definition that any infrastructure which is part of the high way falls within the definition of infrastructure - examining the terms and conditions of award of contract to the assessee to construct, build or operate the said terminal on BOT basis, we find that this is an integral part of highway though the highway was existing already and it was only a stand alone project awarded to the assessee later on - As noticed that the said terminal was having various facilities as stated hereinabove. The case of the assessee finds support from the decision of Dy. Commissioner of Income Tax Vs. Vintage Advertising Pvt. Ltd.[2015 (6) TMI 593 - ITAT KOLKATA] wherein it has been held that assessee is entitled for deduction under section 80IA of the Act on bus shelter and foot over bridge - we direct the AO to allow the deduction under section 80IA.
Disallowance on account of labour charges equal to 1% of the total purchases - disallowance on adhoc basis made by the AO on the ground that these expenses were incurred in cash - CIT(A) partly allowed the appeal of the assessee by directing the AO to add 1% of the purchases - HELD THAT:- There is an apparent mistake in the order of Ld. CIT(A) the labour charges debited to the profit & loss account - We observe that the AO as well as the Ld. CIT(A) has made the disallowance on adhoc basis. We are of the view that ends of justice would be met if a reasonable disallowance is made on this account. Accordingly, we set aside the order of Ld. CIT(A) and direct the AO to disallow a sum of ₹ 1,00,000/-.
Addition u/s 14A read with rule 8D - HELD THAT:- We find merit in the contentions of the AR the disallowance under rule 8D2(iii) was wrongly made at 1.5% of the average investment instead of .5%. Therefore, the same is required to be rectified. Accordingly, we set aside the order of Ld. CIT(A) on this issue and direct the AO to make a disallowance at .5% of average investment. Needless to say that disallowance computed under rule 8D(ii) is correct. Accordingly, we direct the AO to delete the disallowance to the extent of ₹ 10,750/-. Ground is partly allowed.
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2021 (1) TMI 1136 - ITAT SURAT
Estimation of income on bogus purchases - CIT-A directing to make an addition of 5% of unverified purchases - HELD THAT:- As under Income Tax Act only real income can be taxed by the Revenue. We may further note that even in cases where the whole transaction is not verifiable due to various reasons, the only taxable is the taxable income component and not the entire transaction.
Hon’ble Bombay High Court in the case of “CIT vs. Hariram Bhambani” [2015 (2) TMI 907 - BOMBAY HIGH COURT] held that the Revenue is not entitled to bring the entire sales consideration to tax, but only the profit attributable on the total unrecorded sale consideration alone can be subject to income tax. In our view, wherein the allegation bogus purchases, if the assessee is failed to prove the complete transaction beyond doubt, the Assessing Officer is not entitled to make 100% disallowance of purchases without bringing sufficient material on record. In such cases only, profit element embedded in such transaction is liable to be disallowed. Therefore, we affirm the order of ld.CIT(A) - Appeal of the Revenue is dismissed.
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