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Income Tax - Case Laws
Showing 81 to 100 of 661 Records
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2021 (8) TMI 1226
Rejection of Settlement application u/s 245C - allegation of Suppression of facts - non disclosure of earning the additional income - whether the petitioners have disclosed fully and truly all the informations and the materials relating to their foreign bank accounts and certain information not produced by the Assessee may be construed as not within their knowledge? - HELD THAT:- All along the petitioners have not submitted the source and figures and the manner in which the income has been derived. If the Assessee has not furnished the details regarding the income as well as the manner in which such income has been derived, it may not be possible for the Competent Authorities to complete the process of assessment/ reassessment as only if the manner in which the income has been derived is traced out.
In the absence of producing such details, it is the requirements contemplated under Section 245C of the Income Tax Act, the authorities may not be in a position to settle the issues. The repeated findings of the Settlement Commission that the petitioners have failed to state the source from which the income has been derived and the said non-furnishing of information resulted in rejection of application on the ground that the petitioners have suppressed the vital informations.
Petitioners have not complied with the conditions stipulated under Section 245C of the Income Tax Act and when the petitioners were not complied with the conditions stipulated under Section 245C of the Act, the judgments relied on by the petitioners- Assessees have no avail to them for the purpose of considering the present writ petitions.
Legislative intention is to ensure that the manner in which the income has been derived must be disclosed by the Assessee while submitting an application under Section 245C of the Income Tax Act and in the absence of furnishing all such details, settlement cannot be arrived and the authorities are bound to continue their investigation and proceed for assessment or for reassessment under the relevant provisions of the Income Tax Act. - Writ petition dismissed.
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2021 (8) TMI 1221
Revenue expenditure - interest expenses towards delayed payment of EDC external Development Charges to HUDA - allowable expenditure u/s 37 or penal in nature as interest has been charged by concerned authority for delay - HELD THAT:- As decided in TRIVENI FERROUS INFRASTRUCTURE LTD [2019 (11) TMI 1670 - ITAT DELHI] the interest payment as revenue expenditure and not penal in nature, therefore respectfully following the same, the interest expenditure on delayed payment for EDC charges paid to HUDA in the year under consideration is allowable to the assessee. We do not find any error in the order of the Ld. CIT(A) and accordingly, we uphold the same. The grounds of the appeal of the Revenue are accordingly dismissed.
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2021 (8) TMI 1220
Estimation of income - Rate of commission on accommodation entries - income for commission earned at the rate of 2% on sale transaction - HELD THAT:- The assessee being a company of the ‘Tarun Goyal Group’ of the companies, respectfully following the finding of the Tribunal [2019 (1) TMI 1266 - ITAT DELHI], we restrict the rate of the commission assessed by the Assessing Officer to 0.50 % of the transactions carried out by the assessee in the year under consideration. The ground of the appeal of the assessee is accordingly partly allowed.
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2021 (8) TMI 1219
Addition u/s 36 (1)(va) - delay in depositing the ESI and EPF - employees' contribution to specified fund - amount has been paid beyond the due date as prescribed in the ESI & PF Act - HELD THAT:- As relying on M/S. EAGLE TRANS SHIPPING AND LOGISTICS (INDIA) PRIVATE LTD. [2019 (10) TMI 704 - ITAT DELHI] and M/S. BHARAT HOTELS LTD. [2018 (9) TMI 798 - DELHI HIGH COURT] Assessee company is not entitled for deduction u/ s 36(1)(va) of the Act claimed on account of depositing the employees contribution towards ESI & PF as per provisions contained u/s 2(24)(x) read with section 36(1)(va) after due date - Decided against assessee.
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2021 (8) TMI 1218
Exemption u/s 11 - registration u/s 12A denied - proof of charitable activity u/s 2(15) - Commissioner satisfaction to charitable nature of object of assessee society - HELD THAT:- As decided in the case of Ananda Social and Educational Trust [2020 (2) TMI 1293 - SUPREME COURT] has elaborated that the Commissioner is bound to satisfy himself that the object of the Trust are genuine and that its activities are in furtherance of the objects of the Trust and has further held that the term 'activities' in the provision includes proposed activities also - Commissioner is bound to consider whether the objects of the Trust are genuinely charitable in nature and whether the activities which the Trust proposed to carry on are genuine in the sense that they are in line with the objects of the trust
CIT (Exemptions) had no objection to the objects of the assessee which necessarily are charitable in nature and regarding the transactions in the bank account, the same are explainable and these documents were available with her - we are satisfied that the activities of the assessee are genuine and therefore, we direct the CIT (Exemptions) to grant registration u/s 12A of the Act forthwith. - Decided in favour of assessee.
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2021 (8) TMI 1217
Assessment u/s 153A - filing of belated return in response to notice u/s 153A - denying carry-forward of loss claimed in the return filed under section 153A on the ground that return was not filed within the stipulated period of 16 days - Whether provision of the Act which would be otherwise applicable in the case of return filed under section 139(1)? - HELD THAT:- AO has not correctly interpreted the provision - If assessment proceedings in particular assessment year are pending as on the date of the search, same get abated and in consequence to notice under section 153A, assessment of such year would be subject to assessment by the revenue for the first time and the earlier return filed for the purpose of assessment would be treated as non est in law - return filed under section 153A(1)(a) is return furnished under section 139 - provision of the Act which would be otherwise applicable in the case of return filed under section 139(1) of the Act would also apply in case of return filed under section 153A of the Act.
Where the assessments are not abated or no assessments are pending as on the date of the search, the return of income filed under section 139 cannot be treated as non est. In such completed assessments, addition if any can be made on the basis of the income relating incriminating material otherwise the position accepted in completed assessment has to reiterate.
In the year under consideration, it is undisputed that no assessment was pending as on the date of the search and, therefore, the AO is not permitted to make changes in the whatever determined in regular assessment proceeding on the basis of the return of income filed, in absence of any incriminating material. Since in the regular proceeding, the assessee is entitled to carry forward the losses in terms of the provision of the Act, the action of the Assessing Officer in denying the carry forward of the loss on account of the late filing of the return under section 153A of the Act, is not justified. - Decided in favour of assessee.
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2021 (8) TMI 1216
Disallowance u/s 14A r.w.r.8D - computation of expenses incurred for earning the tax free income - mandation of recording of satisfaction - HELD THAT:- Disallowance made by the AO and confirmed by the CIT (A) on the basis of invalid satisfaction as to the correctness of the claim of the assessee is not sustainable, hence ordered to be deleted.
Credit of the entire amount of TDS - HELD THAT:- Following the decision rendered by the coordinate Bench of the Tribunal in assessee’s own case AY 2011-12 [2020 (1) TMI 403 - ITAT DELHI] we are of the considered view that assessee is entitled for credit of tax deducted at source on proportionate basis for the income declared during the year under consideration as per Rule 37BA(3)(ii) of the Rules.
Licence fee paid to the Department of Telecommunication (DOT) for grant of licence to operate and provide services - disallowance by the AO on the ground that the said licence fee paid by the assessee during the years is to be amortized in accordance with section 35ABB- HELD THAT:- Following the decision rendered by coordinate Bench of the Tribunal in assessee’s own case for AYs 2006-07 to 2011-12 and decision rendered by Hon’ble Delhi High Court in assessee’s own case for AYs 2009-10 & 2010-11, we are of the considered view that ld. CIT (A) has rightly deleted the addition, hence finding no infirmity or illegality in the impugned findings.
Depreciation @ 15% on the principal portion of the lease rental - HELD THAT:- In the registration certificate, assessee company is referred as the lessee and Orix Auto is referred as the lessor. Merely mentioning the name of the assessee company as the lessee does not construe ownership in favour of the assessee as has been held in case of ICDS Ltd. [2013 (1) TMI 344 - SUPREME COURT]. It is a basic principle of law that only lessor is the owner of the leased property in case of finances and depreciation is allowable to the lessor only and not the lessee. Lease agreement entered into between the assessee company and lessor of the vehicles itself provides that ownership of the vehicles will not be transferred to the lessee during the subsistence of the lease as is evident from Lease Agreement.We are of the considered view that ld. CIT (A) has rightly decided the issue in favour of the assessee.
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2021 (8) TMI 1215
Unexplained u/s.68 - un-explained cash credit addition - Huge amount withdrawn from bank - self made vouchers for expenses - AO observed that expenses were not supported by bills/vouchers and no TDS was made on such amounts - loose sheets found during survey proceedings - HELD THAT:- This assessee is admittedly a company engaged in construction and building of infrastructure projects/facilities. The department had carried out the survey in question dt.03-10-2012 at its premises. It came across the alleged impounded document forming part of case records before us - This crucial document found at assessee’s premises during survey makes it clear that it is in the nature of assessee’s “INVESTMENT STATEMENT FROM 10-09-2007 TO 10-08-2012” wherein it had duly recorded payment, fund transfers, site payments involving group companies, other payments and administrative expenses along with working capital limits, term loans from banks other loans funds, other group companies’ funds received from sites and ‘other’ receipts indicating varying sums - the impounded document is assessee’s “INVESTMENT STATEMENT FROM 10-09-2007 TO 10-08-2012” wherein its Managing Director had duly pointed out the same in the nature of investments and loans which ought to be treated as un-explained u/s.68 of the Act only.
The assessee’s further argument that the impugned sum “is merely an estimate also fails to inspire confidence since there is no material before us which could suggest the factual position to be different than that found during the course of “survey”. It appears that assessee’s failure in filing its cogent explanation only led the AO to add the impugned sums in all these assessment years. We thus restore this un-explained cash credit addition in these facts and circumstances in AY.2010-11. The CIT(A)’s findings under challenge stand reversed therefore. Revenue succeeds in its instant identical latter substantive ground.
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2021 (8) TMI 1213
Revision u/s 263 by CIT - Addition u/s 40(a)(ia) - assessee had claimed expenditure of Corporate Management Services paid to its AE - claim so made included 'year-end' provision made for an outstanding and assessee voluntarily disallowed above said amount u/s. 40(a)(i) - TPO determined ALP of Corporate Management services at NIL. and while computing TP adjustment, he reduced the amount voluntarily disallowed u/s. 40(a) - HELD THAT:- There should not be any dispute that the claim of the assessee is as per the provisions of sec. 40(a) of the Act - under Explanation to section 92(1) of the Act, the allowance for any expense shall also be determined having regard to arms length price - TPO has determined the arms length price at NIL in AY 2009-10, the entire claim made in the profit and loss account should have been considered as transfer pricing adjustment - TPO has reduced the amount disallowed u/s. 40(a) and made transfer pricing adjustment for the balance amount only in AY 2009-10
The question of making disallowance u/s. 40(a) shall apply, only if the relevant expenditure was found to be allowable, but for the provisions of sec. 40(a). Hence the action of TPO in reducing the T.P adjustment amount by the disallowance made u/s. 40(a) may not be right and in that case, the error lies in AY 2009-10. Having not done so, the Ld. CIT should not find fault with the claim of the assessee made u/s. 40(a) of the Act on the reasoning that the TDS has been made in this year, i.e., in AY 2010-11. the order passed by Ld. CIT(A) on this issue cannot be sustained.
Foreign services Employees expenses - TPO had determined ALP of intra group services at NIL - AR also took us through the query posed by the TPO during the course of TP proceedings. TPO has specifically asked whether the assessee is claiming any reimbursements as expenses without routing though the Profit and Loss account? - The assessee has also furnished reply to the same stating that reimbursement claims have been routed through the Profit and Loss account, meaning thereby, the TPO has specifically applied his mind on this issue. Hence the TPO has examined this issue and has taken a possible view, in which case, the revision order passed by Ld. CIT on this issue is also liable to be quashed.
In the case of Malabar Industrial Co Ltd. as [2000 (2) TMI 10 - SUPREME COURT] as expressed the view that the assessment order cannot be considered to be prejudicial to the interests of revenue, if the AO has taken a plausible view - impugned revision order is not sustainable in law. - Decided in favour of assessee.
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2021 (8) TMI 1212
TP Adjustment - appropriate PLI for benchmarking the international transaction of rendering of business support services in respect of the overseas projects of the AE - not considering return on value added cost (ROVAC) - TPO opined the transaction in the present case is being compared is sales to AE and held the ROVAC cannot be used for the purposes of computing the PLI, as if would directly influence the PLI being in the denomination for computation of the rates - HELD THAT:- The contention of the ld. AR is that the contract charges incurred by the assessee for the services taken from third parties and prayed to treat the assessee as trader. Therefore, in our opinion, the berry ratio becomes academic
We deem it proper to remand the matter to the file of TPO for its fresh verification to decide whether the assessee is in the activities of business support service provider or in the trading activities or in the mix of both i.e. business support service provider and trading activities. The assessee is liberty to file all evidences, if any, in support of its claim and the TPO shall decide as indicated above. Appeal of assessee is allowed for statistical purpose.
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2021 (8) TMI 1211
Disallowance u/s 40(a)(ia) - Assessee in default under the first proviso to 201(1) - Assessee did not file Form 26A which is the certificate of auditor certifying that the payee has included the amount received from the assessee in his return of income filed for the relevant assessment year and paid taxes thereon - HELD THAT:- Assessee filed before us certificate of a Chartered Accountant under the 1st proviso to sub-section 1 of section 201 of the Act certifying that M/s. Cholamandalam Investment and Finance Company Ltd., has filed the return of income for Assessment Year 2014-15 and has included the income received form the assessee in such return of income - in the light of the certificate of the Chartered Accountant filed by the assessee, the issue with regard to the disallowance under section 40(a)(ia) of the Act should be remanded to the AO for fresh consideration - Appeal of the assessee is treated as allowed for statistical purposes.
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2021 (8) TMI 1210
TP Adjustment - corporate guarantee forms an international transaction or not? - Retrospective amendment to Section 92B - HELD THAT:- All the legal arguments fail to convince us as per Hon'ble Madras high court’s recent decision in Pr.CIT Vs. M/s.Redignton (India) Limited, [2020 (12) TMI 516 - MADRAS HIGH COURT] holds that Explanation to Section 92B inserted vide the Finance Act, 2012 with retrospective effect from 01-04-2002 also includes a corporate guarantee. We thus hold that the tribunal’s all foregoing orders must make way for higher wisdom and decline the assessee’s first and foremost legal plea.
Quantification of the impugned corporate guarantee adjustment - As relying on own case [2016 (1) TMI 936 - ITAT HYDERABAD] adopt judicial consistency and direct the TPO to adopt 0.53% rate in both these assessees’ cases in all these respective assessment years.
Quantification of the corporate guarantee adjustment itself in all these three assessment years - There is no dispute between the parties that the TPO herein had himself made it clear that “in case of guarantees covering more than one financial year the fee is charged by the banks at the beginning of the financial year on the outstanding amount”. As against this, the Revenue fails to dispute that case law BS LTD. [2018 (4) TMI 1742 - ITAT HYDERABAD], MANUGRAPH INDIA LTD. [2015 (3) TMI 1103 - ITAT MUMBAI] and M/S ACG ASSOCIATED CAPSULES PVT. LTD[2012 (2) TMI 101 - SUPREME COURT] hold that such a corporate guarantee adjustment could only be made to the extent of actually utilized amount during the year than that of the full value of the guarantee itself. We adopt the very reasoning herein as well and directing the TPO to re-compute the impugned adjustment after taking into consideration only the actually utilised amount of the corresponding corporate guarantees in these three cases. The assessees’ identical first and foremost ground in all these three appeals is partly accepted in foregoing terms.
Disallowance u/s 14A r.w.r. 8D - proof of sufficient non-interest bearing funds - HELD THAT:- Section 14A read with Rule 8D applies only in relation to an assessee’s exempt income than having any independent exigibility. It is an admitted fact that the assessee has not derived any exempt income in the relevant previous year. We therefore direct the Assessing Officer to delete the impugned disallowance for this precise reason alone.
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2021 (8) TMI 1209
Revision u/s 263 - as per CIT AO's action in respect of receipt of share capital by the assessee is erroneous as well as prejudicial to the revenue - HELD THAT:- AO had issued notice u/s.142(1) and called for all the details of the share subscribers/share premium and pursuant to the notice of AO, the assessee had filed all the documents to substantiate the identity, creditworthiness and genuineness of the share subscription. The source of source of the share subscription was also brought to the notice of the AO,
Assessee company is a private limited company and it is closely held and has raised share subscription from its own directors and their wives who are all income tax assessee's and all the money has come through banking channel and their creditworthiness has also been proved by the documents produced - PCIT erred in finding that the source of share subscribers has not been properly enquired by the AO - since the condition precedent for invoking the revisional jurisdiction has not been satisfied the Ld. PCIT lacks of jurisdiction. - Decided in favour of assessee.
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2021 (8) TMI 1207
Condonation of delay - proof of reasonable cause for not filing the appeal in time before the CIT (Appeals) - HELD THAT:- Assessing Officer had sent the demand notice at incorrect address which is clear from the demand notice and the envelope placed on record - demand notice was served by affixation on 30th March, 2013, at wrong address. In fact, in the assessment order, the Assessing Officer himself has recorded that the correct address where the assessee resides, alongwith her husband. However, despite the above said the assessment order along with the demand notice were sent at the wrong address - the assessee was prevented from filing the appeal before the CIT (Appeals) within the time granted by the statute.
Unexplained investment - Registered sale deed was made in the name of the assessee and her husband - AO had made the addition of 50% of assessee's share - HELD THAT:- Though the assessee sought to explain the source disclosed by Assessee's husband in his assessment order, however, the same do not come for rescue for the assessee, as it is for the assessee to disclose the source of investment made by her in the property.
Nothing has been disclosed and merely because the same was disclosed by the husband of the assessee, in our view, is no explanation in the eye of law as it is required to be independently tested and examined by the revenue authorities- in the assessment proceedings, the assessee has not submitted that the investment made by her was made after borrowing it from the husband. In fact, it was the case of the husband that the consideration was paid in cash to the seller. The assessing Officer of the husband had made the addition in the hands of the assessee (on account of undisclosed cash deposit in the bank account).
As the assessee failed to disclose the source of investment either before the Assessing Officer or before CIT or before us, therefore, we have no other option but to confirm the addition - Decided against assessee.
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2021 (8) TMI 1206
TDS u/s 194A - disallowance of interest paid to non-banking finance companies - Non deduction of TDS - AR submitted that the recipient of the payment has already been paid the tax and as such the same cannot be disallowed in the hands of the assessee - HELD THAT:- In view of the above order of the Tribunal [2019 (12) TMI 1537 - ITAT BANGALORE] we inclined to remit the issue to the files of the A.O. to allow the claim to the extent that the recipient of the payment paid the tax to the department. Accordingly, this issue is remitted to the files of the A.O. for verification of the issue and deciding the same in accordance with law.
Disallowance u/s. 14A - AR submitted that the assessee earned dividend income which is exempt from Income-tax and the amount used for investments yielding exempt income, was made from assessee's own funds - HELD THAT:- It is the claim of the assessee that the assessee has earned dividend income which is exempt from income tax and the funds used for investment is from its own funds. However, the assessee could not demonstrate the availability of its own funds for investment in exempt income. We, therefore, remit this issue to the files of the A.O. to examine the issue afresh and also direct the assessee to prove the availability of own funds for making investment in such exempted income yielding assets.
Disallowance of interest on advances made to Naveen Hotels towards purchase of land - Contention of the learned AR is that the assessee is having own funds to make investments to its sister concern - HELD THAT:- As the assessee has to prove that it is having sufficient interest free own funds to make investment to its sister concern - Case of Reliance Industries Limited [2019 (1) TMI 757 - SUPREME COURT] correctly relied - assessee has also to prove that it has not used any borrowed funds. With these observations, we remit the matter to the files of the A.O. to examine whether the assessee is having availability of interest free funds to make investment in sister concern. This ground is partly allowed.
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2021 (8) TMI 1205
Exemption u/s 10(23FB) - Assessee has made investment in VCUs (Venture Capital Undertakings) - as per AO said VCU is not engaged in carrying out any real estate business during the financial year 2015-16 as there was no financials maintained by the company and as the directors of the said entity were in custody for making defaults -Amrapali Smart City Developers Pvt. Ltd. (ASCD) - HELD THAT:- CIT(A) has accepted the claim which has also been reiterated by the assessee that interest income accruing from the said concern had been allocated to various investors who would have included the same in their return for income tax and paid the due tax in terms of section 115U and taxing the said income in the hands of the assessee would result in double taxation. In this regard we note that learned Counsel of the assessee has made further submissions before us that in the subsequent financial year the assessee has reversed the interest entries from this concern on the ground that receipt was extremely doubtful - As pointed out that the assessee has not claimed deduction of the said reversion in financial accounts. In this view of the matter, in our considered opinion order of CIT(A) on this issue is cogent and does not need any interference in our part.
Disallowance made with respect to CSN Estates Pvt. Ltd - CIT(A) is correct in holding that CSN is engaged in the development of the project. That it has purchased and provided land for the project, obtained necessary approvals and sanctions and has entered into development agreement with Lemon Tree for development and construction. Hence, in our considered opinion disallowance made by the Assessing Officer has been rightly deleted by learned CIT(A)
Whether income of VCF shall be exempt only to the extent it is from the investment in venture capital undertaking ? - CIT- A deleted the addition - HELD THAT:- Observation of the AO that, VCF was eligible for deduction under a specific section 10(23FB) and therefore it cannot claim deduction under another section 10(35) of the Act is totally inapplicable in the facts and circumstances of the case. Exemption under section 10(23FB) and exemption under section 10(25) of the Act operates in different fields. CIT(A) is correct in holding that operations of these sections are independent. Assessee’s income in VCU is exempt under section 10(23FB) of the Act and the dividend income is exempt under section 10(35) of the Act. Hence, there is no infirmity in the assessee’s claim of exemption on dividend income under section 10(35) - Decided against revenue.
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2021 (8) TMI 1204
Suppressed profit on sale of project - undisclosed income - Estimation of Net profit of suppressed sales - HELD THAT:- This addition was duly and properly made on the basis of material discovered during the search. In our considered opinion learned CIT(A) has taken a correct view of the matter and has addressed all the issues. Accordingly, we uphold the order of learned CIT(A).
Addition u/s.40(a)(ia) - Non deduction of TDS - expenses on account of construction expenses and on account of labour charges - HELD THAT:- As the case of the appellant is covered by the decision in case of Bharati Shipyard [2011 (9) TMI 258 - ITAT MUMBAI] and in case of DCIT vs. Ashika Stock Broking Ltd [2010 (11) TMI 555 - ITAT, KOLKATA]. Therefore, it is held that the case of the assessee is covered u/s. 40(a)(ia) and the addition made by the AO on this account is upheld.
Unexplained cash credit u/s. 68 - HELD THAT:- We find that the assessee has duly submitted additional evidences before learned CIT(A). It was duly submitted that the amount received was booking advance and name of the party, his confirmation and photocopy of the PAN was also submitted. CIT(A) simply rejected the additional evidence on the ground that it was not submitted earlier - issue may be remitted to the Assessing Officer - Appeal by the assessee is allowed for statistical purposes.
Rectification of mistake u/s 154 - Addition had been made on the order but the same remained to be added in the computation of total income - HELD THAT:- We find ourselves duly in agreement with the order of learned CIT(A). The Assessing Officer having made addition by discussing in the assessment order and making the addition in the body thereof and has mistakenly omitted it from the computational part. Hence, in our considered opinion there is no infirmity in the order under section 154 correcting the same. As rightly pointed out by learned CIT(A) the merits in this regard could not have been gone into by the Assessing Officer in the proceedings under section 154 of the Act. Hence, we uphold the order of learned CIT(A).
Addition u/s 68 - sundry creditors and advances for booking as the parties have not responded to the notice u/s 133(6) - HELD THAT:- In the order of the Assessing Officer, only balances as at the closing of the year has been mentioned. It is not mentioned whether they arose during the year or they are coming from earlier year. In case they are coming from earlier year, addition under section 68 of the Act is not at all permissible. Hence, in our considered opinion this issue needs to be remitted to the file of the AO. AO shall examine the issue afresh in the light of our observation as above and thereafter he will pass an order in accordance with law.
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2021 (8) TMI 1201
Long tern capital gain - Valuation of property - determination of fair market value of the property - adoption of the deemed sales consideration according to the provisions of Section 50 C - HELD THAT:- As the difference between stamp duty valuation u/s 50C is just 8.98 % higher than the actual sale consideration. Only actual sale consideration should be taken for working out capital gain. Accordingly, additional ground raised by the assessee is allowed.
Deduction u/s 54 - whether it is to be restricted to only one residential unit against the total investment made by the assessee in two adjoining residential unit - HELD THAT:- Assessee has purchased two adjacent units of house property and claimed deduction u/s 54 of the Act. For the impugned assessment year section 54 provided exemption in investment in “a‟ residential house and which is amended by Finance Act, 2014 wherein, word “a‟ has been replaced by word “one ‟. This amendment is prospective in nature cannot be given a retrospective effect. In view of this, in the facts and circumstances of the case whether the assessee has purchased two adjacent residential houses, according to us the assessee is entitled to deduction u/s 54 of the Act on the amount invested in both the houses.
Addition u/s 69 - Unexplained investment in purchases of property - HELD THAT:- Source of the fund is available with the assessee for payment to the builder and further the medical exigencies are meet by the Govt is not denied, We found that in absence of any other evidences contrary , benefit of cash available on hand should be granted four source of investment of ₹ 1 lakh with the builder. Accordingly, we direct the ld AO to delete the addition - Decided in favour of assessee.
Adopting indexed cost of acquisition shown by the assessee - HELD THAT:- AO has considered the indexed cost of acquisition without giving any reason that why he is not agreeing with the indexed cost of acquisition shown by the assessee of ₹ 6,991,206 as shown in the computation of income. Therefore we agree with the argument of the learned authorised representative. We direct the ld AO to consider the cost of acquisition of the property sold/transferred for computation of capital gain. Thus, Ground is allowed.
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2021 (8) TMI 1193
Bogus Purchases - as per AO accommodation entries provided by various dealers and assessee was also one of the beneficiary - CIT-A deleted the addition - HELD THAT:- Purchases are supported by proper invoices duly reflected in the books of accounts, the payments have been made by account payee cheque which are duly reflected in the bank statement of the appellant. There is no evidence to show that the appellant has received cash back from the suppliers - AO has not disputed the sales of the concluded that there is no basis to disbelieve the purchases made by the appellant from the alleged parties which could, have caused any leakage to the revenue necessitating estimated disallowance claim of the appellant, cannot be denied. The AO is directed to delete the disallowance - Decided in favour of assessee.
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2021 (8) TMI 1192
Commission charged towards accommodation entries provided - CIT(A) restricting the quantum of commission at the rate of 0.6% based on the average of the past four years profits - HELD THAT:- Estimation as made by CIT(A) was in accordance with average profits shown in earlier 4 years. Even if the transactions were sham transactions, the estimation, in our considered opinion, was to be on some rational basis. The basis as adopted by Ld. CIT(A) was more rational and plausible one. Therefore, no fault could be found in the said estimation.
Estimation of income on contract receipts and commission income - CIT(A) has merely gone by the fact that the aforesaid receipts would be business income of the assessee keeping in view assessee’s main objects - he has overlooked the fact that no estimation of income was made by Ld. AO against these transactions and the estimation was only with respect to sale & purchase transactions. These items, as noted by Ld. AO, were separately credited to Profit & Loss Account and hence, constitute separate stream of income for the assessee - a separate estimated income against these two items would certainly be required. We make the estimation @8% for both these streams of income.
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