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Income Tax - Case Laws
Showing 101 to 120 of 774 Records
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2022 (6) TMI 1334 - ITAT BANGALORE
TP Adjustment - Comparabaility - HELD THAT:- Companies functionally dissimilar with that of assessee functional profile need to be deselected from final list - RPT filter has to be applied adopting the threshold limit of 15%.
Disallowing the import of equipment under the surmise that there were no supporting documents to prove its genuinity - AO treated the value of this asset as a benefit or perquisite by the assessee in the course of its business brought to tax the aforesaid sum under section 28(iv) - DRP rejected the claim of the assessee on the ground that no evidence was placed on record to show that the assessee returned back the equipment - HELD THAT:- We are of the view that this approach of the DRP is incorrect because the question of return of the equipment will arise only when there is evidence to show that the assessee received the benefit in the form of benefit or perquisite from the RDT. Revenue cannot place negative onus on assessee and seek to make impugned addition. The impugned addition is therefore directed to be deleted.
Addition for non production of import invoices - HELD THAT:- From a perusal of the given table of import information for the balance assessable value along with the purpose for which these have been imported and the purpose of import as given in the last column of the above table, it is clear that the equipments in question were received from respective suppliers for testing and functionality of IT services provided by the Assessee to them. The issue therefore is identical to ground No.15 and for the reasons stated while deciding those grounds, we are of the view that the addition made cannot be sustained and the same is directed to be deleted.
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2022 (6) TMI 1333 - ITAT BANGALORE
Addition being cash deposit made into his bank account during the demonetisation period - HELD THAT:- A.R. took us through the copies of bank account placed in the paper book. A perusal of the same would show that the assessee has withdrawn a sum from his bank account maintained with ICICI Bank on 05.06.2015. We notice that the assessee has withdrawn cash in small amounts in subsequent period also. Since the assessee is an aged person and retired from army, it is quite possible that the assessee had kept the money in cash with him in order to meet medical emergencies.
The assessee is a pensioner and there is no other material to show that the cash withdrawn earlier had been spent away. Accordingly explanation of the assessee that he has made the deposit out of the cash withdrawal made earlier is quite plausible. Accordingly sources for making deposits stand explained in this case. Appeal filed by the assessee is allowed
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2022 (6) TMI 1330 - MADRAS HIGH COURT
Interest levied for delay in the remittance of the taxes - Application seeking waiver of interest u/s 220 (2A) - voluntary disclosure of amounts by the respective petitioners in the course of the search - HELD THAT:- Petitioners would stress upon the extreme hardships faced by the assessees in remitting taxes, though with delay. Moreover, he attributes the difficulties to the substantial delay on the part of the respondents in issuing refunds to the companies in which the petitioners’ were Directors.
Had such refunds been paid in time, he submits that the same would have been utilized by them to settle their tax demands earlier and intime. This submission would hold no water in the present case, seeing as the demand of tax has been made on the admitted income offered by the petitioner to tax in the returns of income.
Had it been a case where the tax demand had arisen on account of additions/disallowances to the admitted income, the position may have been viewed differently. However, seeing that the tax demand in the present case arises entirely from admitted income and the order of has assessed and attained finality, there is no merit in these writ petitions. The impugned orders are confirmed and these writ petitions, dismissed. Connected writ miscellaneous petitions are closed.
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2022 (6) TMI 1329 - ITAT MUMBAI
Income deemed to accrue or arise in India - Applicable rate of taxation - retrospective insertion to Explanation to Section 90 - Assessee claim for the benefit of the non-discrimination clause of the India-Korea Double Taxation Avoidance Agreement (‘DTAA’) -taxing the Appellant’s income @ 40% (plus surcharge and education cess) or at rate applicable to a resident taxpayer - levy of the income tax on the assessee company at a rate higher than the domestic companies - HELD THAT:- We hold that the applicable rate of taxation, under the Income Tax Act 1961, for the assessee company cannot be read down in the light of the provisions of a double taxation avoidance agreement, as is the specific mandate of Explanation 1 to Section 90 or even on the first principles without the benefit of this Explanation.
As for the mention, in paragraph 7 of the Bank of Tokyo Mitsubishi decision [2019 (8) TMI 895 - CALCUTTA HIGH COURT] of some clarification issued by the CBDT with respect to ABN Amro Bank, even if that be so, it is only elementary that Section 119(1)(a) does not visualize issuance of a circular “so as to require any income-tax authority to make a particular assessment or to dispose of a particular assessment in a particular manner”, and, therefore, such a clarification will not have any bearing on cases other than ABN Amro Bank, or the legally binding force of Section 119. In any event, even going by the observations made by the Hon’ble High Court, this communication was issued prior to 24th November 1997 – much before the retrospective insertion of Explanation 1 to Section 90 took place. With the amendment in law and with this significant change in the legal position, even if there is an old circular, issued in the context of pre-amendment law, it will not hold good any longer. Nothing, therefore, turns on the said communication either, and, in any event, even this communication has not been sighted before us.
We are of the considered view that the plea of the assessee is, therefore, devoid of any sustainable merits. We reject the plea of the assessee, and decline to interfere in the matter.
Deductibility of Interest paid by the Appellant to its Head Office - AO/DRP disallowing interest paid by the Appellant to its head office - HELD THAT:- The short reason for which the impugned disallowance is made is that the payment by an entity to itself, i.e. by its permanent establishment to the head office, and, therefore, it is an inadmissible deduction. What this approach overlooks is that this theory of tax neutrality vis-à-vis intra-company payments and incomes, whatever be its relevance or irrelevance in the cross-border situations, finds its support from judicial precedents in the cases of Sir Kikabhai Premchand [1953 (10) TMI 5 - SUPREME COURT] and Betts Hartley Huett & Co Ltd [1978 (4) TMI 58 - CALCUTTA HIGH COURT] is in the context of the computation of profits under the Income Tax Act. This theory would not, therefore, extend to the computation of profits attributable to a permanent establishment under the scheme of the tax treaties.
The five-member bench decision, in the case of Sumitomo Mitsui Banking Corp [2012 (4) TMI 80 - ITAT MUMBAI] recognizes this position and specifically states that “the position under the domestic law, as emanating from the above judicial precedents is that one cannot make profit out of himself”, and in the lights of the corollaries to this position, declined the applicability of this theory in the treaty situation. There is no other reason assigned in this case in support of the disallowance of interest paid by the PE to the head office or the GE. For this short reason alone, therefore, the impugned interest disallowance must be deleted.
The computations of profits attributable to the PE are to be computed on the basis of this hypothetical independence of the PE from its GE, and, to that extent, the profit neutrality theory of intra-company transactions will not come into play - though the assessee had initially raised a grievance against the taxability of interest received from its head office, when the appeal came up for hearing before us, this plea was abandoned even as there was a five-member bench decision, in support of the assessee, on that point. The assessee has claimed a deduction for interest paid by the PE to GE, and included in its taxable income, interest received by the PE from its GE. That is what, in our humble understanding and for the reasons set out above, the computation of profits of the PE, under the scheme of the tax treaties, envisages. In view of these discussions, and bearing in mind the entirety of the case, we hold that the disallowance of interest is not sustainable in law. Assessing Officer is directed to delete the same.
Whether the said interest paid by the PE to GE (i.e. PE-GE interest) can be taxed in the hands of the assessee company as income of the GE, as has been done by the Assessing Officer? - It may perhaps be too much to contend that the taxability of PE-GE interest receipt is required to be considered on the basis of the domestic law provisions, but even this discussion seems entirely academic in the light of our finding, as above, that an internal charge for the PE profit attribution does not amount to taxable income in the hands of the GE anyway. Be that as it may, having decided this aspect of the matter on the treaty principles so far as taxability of PE-GE interest in the hands of the GE is concerned, we need not examine that aspect any further. In our considered view, for the detailed reasons set out in this order, dehors this theory of tax neutrality for intra-GE transactions also, this PE-GE interest is not taxable in the hands of the assessee. Of course, we have reached the same destination by following a different path but then as long as reach the same destination, our traversing through a different path does not really matter at all.
We uphold the plea of the assessee that the interest paid by the PE to the GE cannot be brought to tax in the hands of the assessee company, even though it is to be allowed as a deduction in the computation of profits attributable to the permanent establishment. The Assessing Officer is directed to grant the relief accordingly. The assessee has already offered to tax the interest income received from its head office, and there is no surviving dispute in respect of the same.
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2022 (6) TMI 1327 - ITAT DELHI
Addition on account of jewellery found in the search premises of the assessee - HELD THAT:- On consideration of the rival submissions of the parties, we are of the opinion that in the interest of justice and fair play, the matter should be restored back to the file of the AO to verify the veracity of the claims made by the assessee who shall produce evidence which were not available with him during the course of assessment proceedings for the purposes of verification. The Ld. AO shall also consider the claim of the assessee taking into account the CBDT Instruction No. 1916 dated 11.05.1994 and decide the issue afresh after giving reasonable opportunity of hearing to the assessee.
Addition u/s 69A on account of cash found during search - HELD THAT:- Right from the stage of search, the case of the assessee has been that the family withdraws Rs. 40,000/- every month for meeting house-hold expenses and the cash found in search is accumulation of savings. Moreover, documentary evidence of bank statement showing withdrawal of cash of Rs. 1,00,000/- by the assessee and Rs. 1,50,000/- by his wife on 20.04.2012 just few days before search on 09.05.2012 was placed on record. There is no adverse finding that the said withdrawals of cash was utilised for any specific purpose and that nothing was available out of the said withdrawal of cash. We are, therefore, inclined to hold that the source of cash available at the time of search has been satisfactorily explained by the assessee and delete the impugned addition.
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2022 (6) TMI 1325 - ITAT AHMEDABAD
Disallowance u/s 14A r.w.r. 8D - HELD THAT:- As relying on VISION FINSTOCK LTD [2016 (7) TMI 603 - ITAT AHMEDABAD] restrict the disallowance made by the Assessing Officer under Section 14A read with Rule 8D and sustained by the learned CIT(A) to Rs.50,000/- being the exempt income actually earned by the assessee in the year under consideration. In the result, the appeal of the Revenue is dismissed while the appeal of the assessee is partly allowed.
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2022 (6) TMI 1323 - ITAT MUMBAI
Unexplained expenditure - difference in narration in the bank account - details of which were found in the Cash Transaction Record maintained in an excel sheet by Shri Ashok Sharma, which was found and seized during the search in the case of the Indiabulls Group - HELD THAT:- We find that there are identical expenditure which are held to be unexplained expenditure for seven years which has been deleted by CIT (A). As also the claim of the assessee that the transactions have already been offered as income before the settlement commission.
CIT (A) deleted this addition for the reason that the amount has already been considered in income of the assessee and other entities before the settlement commission. In view of this, we do not find any infirmity in the order of the learned CIT (A) in deleting the addition. Merely because the order of the settlement commission has been challenged before the Hon'ble High Court, unless that order is reversed, we do not find any infirmity in the order of the learned CIT (A). Accordingly, ground no. 1 to 3 of the appeal is dismissed.
Allowability of deduction of education cess - HELD THAT:- We find that in view of amendment by introduction of explanation 3 inserted by Finance Act, 2022 with retrospective effect from 1st April, 2005, assessee is not entitled for deduction of education cess. Accordingly, grounds of the appeal is allowed.
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2022 (6) TMI 1322 - ITAT DELHI
Reopening of assessment u/s 147 - reassessment proceedings on the basis of PAN/AIR information that the assessee has sold immovable property during F.Y. 2008- 09 - HELD THAT:- Assessee has successfully demonstrate that PAN No. BAHPS3364R and filed return of income for A.Y. 2009-10 on 18.02.2010 whereas the Assessing Officer in the reasons recorded for reopening the assessment stated that no return has been filed by assessee. This shows casual approach of Assessing Officer in initiating reassessment proceedings on the basis of incomplete details regarding filing of ITR by assessee for A.Y. 2009-10.
In this situation and in view of proposition rendered by ITAT, Delhi in the case of Shri Jagat Singh [2018 (9) TMI 1776 - ITAT DELHI] we are compelled to hold that reassessment proceedings u/s 147 of the Act and notice u/s 148 of the Act is issued without application of mind by AO on the basis of incomplete information without any verification of the facts then it amounts to omission on the part of AO in complying with the mandatory requirement of Section 147 & 148 - Consequently, reassessment order and of consequent proceedings and orders become bad in law.
Assessment order passed u/s 147/144 of the Act is not sustainable being bad in law thus the same is quashed. Accordingly, the legal ground No.1 and 2 of assessee are allowed.
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2022 (6) TMI 1321 - ITAT CUTTACK
Revision u/s 263 - as per CIT AO did not make any prudent enquiry in respect of the difference in the valuation of current assets and current liabilities shown in the balance sheet as on 31.3.2008 vis-à-vis the same shown in the cash flow statement filed before the Assessing Officer - whether assessment as validly reopened by the AO? - As per assessee what the AO could not do u/s.147 of the Act could not be done in the guise of revision proceedings u/s.263 - HELD THAT:- When the details were before the AO and the AO has not adjudicated on the issue when such glaring difference are there, especially when he has made valid reopening, it cannot be said that the AO did not have power to go into the said issue as pointed out by ld CIT DR. A reading of section 147 of the Act shows that the word used in section 147 “or any other allowance or deduction for such assessment year”.
It also used the words “ assess or reassess such income or recompute the loss or the depreciation allowance”. In the present case, the difference between the cash flow statement and balance sheet was very much available to the AO to be processed in the reopened assessment.
Failure on the part of the AO to examine the same and form an opinion on the issue established that, when the difference was so glaring, has clearly made the order erroneous and consequently prejudicial to the interest of the revenue. This being so, as the AO has not applied his mind to the information that has been supplied by the assessee nor he has considered such information nor formed an opinion in respect of such information, the ld CIT, Bhubaneswar was right in invoking his powers u/s.263 of the Act in revising the assessment order passed u/s.143(3)/147 of the Act dated 30.3.2013 in the case of the assessee.
A query was raised to ld AR as to what happened to the consequential order passed in pursuance to order u/s.263 of the Act, to which, ld AR submitted that consequential order has been passed and the appeal had been filed to the ld CIT(A). The ld CIT(A) has dismissed the same exparte. Further appeal had been filed to the Tribunal and the Tribunal had also exparte restored the issue back to the file of ld CIT(A).
A very interesting fact on this issue established that even before the CIT(A), the appeal was dismissed for non-compliance. The Tribunal in the interest of natural justice had restored the issue to the file of the ld CIT(A) so that the assessee could be granted the opportunity to substantiate its case. This clearly shows that the assessee is not interested in showing the reconciliation but is attempting to use technical reasons to avoid the responsibility. Appeal of the assessee stands dismissed.
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2022 (6) TMI 1319 - DELHI HIGH COURT
Reopening of assessment u/s 147 - validity of notice issued u/s 148A(b) - HELD THAT:- This Court is of the view that the Revenue by asking the Petitioner-Assessee to respond to the aforesaid vague show cause notice was virtually asking the Petitioner to search for ‘a needle in a haystack’.
Revenue now states that the Respondent shall supply all the relevant material documents and information in its possession, the impugned order passed u/s 149A(d) as well as the notice issued u/s 148 are set aside with a direction to the Respondent-Revenue to issue a supplementary notice in pursuance to the initial notice issued u/s 148A(b) within three weeks enclosing all the relevant/incriminating information/material/documents. The Petitioner shall file its response to the said supplementary notice within three weeks.
AO is directed to pass a fresh order u/s 148A(d) in accordance with law within six weeks thereafter. With the aforesaid directions, present writ petition along with pending application stands disposed of.
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2022 (6) TMI 1318 - ITAT SURAT
Disallowing credit of TDS deducted by the employer but not deposited to Government Account - HELD THAT:- We find that the assessee filed an appeal before CIT(A) on 28.06.2018. The appeal of the assessee was transferred to NFAC in term of notification of CBDT dated 25.09.2020. The ld. CIT(A)/NFAC passed the order on 08/09/2021. CIT(A)/NFAC passed its order on the basis of details of intimation U/s 143(1) of the Act and the statement of fact was pleaded by assessee in Form 35 (the appeal filed the ld. CIT(A)/NFAC).
Before us, assessee has furnished a copy of Form 26-AS for the financial year under consideration. On perusal of copy of entry in Form 26AS, we find that there are certain tax credit shown in Form 26AS, therefore, we restore the case to the file of Assessing Officer/CPC to verify the facts and grant the credit/set off of tax shown in Form 26AS and passed the speaking order in accordance with law.
AO is directed to grant reasonable opportunity to the assessee before passing the order. The assessee is also directed to provide all necessary information and evidence including the copy of Form-26AS to the AO. The AO is also directed to consider the decision of Kartik Vijaysinh Soanvane [2021 (11) TMI 682 - GUJARAT HIGH COURT] and pass the order in accordance with law. In the result, the ground of appeal raised by the assessee is allowed for statistical purposes. In the result, the appeal of the assessee is allowed for statistical purpose.
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2022 (6) TMI 1316 - ITAT MUMBAI
Levy of penalty u/s.271(1)(b) - absence in the initial period before the ld. AO - In the course of re-assessment proceedings though initially the assessee did not secure its presence in person or through her authorised representative before the ld. AO, finally appeared before the ld. AO in person and even furnished a statement u/s.131 of the Act before the ld. AO by filing the requisite details - HELD THAT:- The assessee explained before the ld. AO that she got married during the course of re-assessment proceedings and that she was under the confusion as to who was handling her income tax matters i.e. whether it is being handled by her father or by her in-laws. In view of this confusion, there was some absence in the initial period before the ld. AO but later on once the confusion was resolved, she started appearing in person before the ld. AO and furnished all the requisite details that were called for. Ultimately, the assessment was completed u/s.143(3) of the Act by the ld. AO, which goes to prove that the earlier absence of the assessee has been duly condoned by him
No penalty u/s.271(1)(b) of the Act could be levied when an assessment has been completed u/s.143(3) of the Act, wherein the ld. AO is deemed to have condoned the absence of the assessee or his authorised representative on earlier occasions when subsequently, the details were furnished by him and the assessments were ultimately completed u/s.143(3) of the Act. Hence, we deem it fit that this is not a fit case for levy of penalty u/s.271(1)(b) of the Act. We direct the ld. AO to delete the said penalty. Accordingly, the grounds raised by the assessee are allowed.
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2022 (6) TMI 1315 - ITAT MUMBAI
Deduction u/s 80IA for its unit at Silvassa - 10th year of commercial production - Addition on the ground that AY 2008-09 is the eleventh (11th) year of such a claim, whereas according to assessee AY 2008-09 is the tenth (10th) year of claim u/s 80IA of the Act and therefore it is a legitimate claim - HELD THAT:- We note that as per Section 80IA of the Act, for the first five years, the assessee was entitled to claim 100% deduction and for the rest of the five years, the assessee can claim deduction only 30% of the profits from the eligible unit. Thus since the assessee’s first year of claim was in A.Y.1999-2000, the assessee got upto A.Y.2003-04 (five years from AY.1999-2000) 100% deduction (refer page no. 102 of the P.B) and thereafter the assessee received only 30% deduction from AY. 2004-05 deduction u/s 80IA of the Act for Silvassa Unit was granted by the AO at 30% to the tune of Rs.48,31,672/-. And for A.Y.2007-08 i.e. 9th year, the assessee received 30% deduction which is evident from the page 106 of the paper book.
We find that 10th consecutive year as per the assessment years framed by AO’s as referred to (supra) is A.Y.2008-09, since the first year of deduction u/s 80IA of the Act in respect of profits for Silvassa Unit was for A.Y.1999-2000 and ten (10) year has to be reckoned from that year, so AY 2008-09 is the tenth year and therefore, the AO erred in holding that the assessee is not entitled for deduction u/s 80IA of the Act because AY 2008-09 is the 11th years.
We find that the AO had erred in denying the claim of deduction u/s 80IA of the Act for A.Y.2008-09 and likewise the Ld. CIT(A) also erred in denying the claim of the assessee. Therefore, we are inclined to allow the claim of the assessee u/s 80IA of the Act and direct the AO to allow the claim. Ground no. 1 is allowed.
Recomputation of the profits of the eligible unit at Silvassa at the reduced amount - reallocation of various expenses on turnover basis (as against on actual basis and partly on turnover basis) - HELD THAT:- As shown by the Ld. AR that the allocation was based on turnover of the lubes sales of respective plants. Thus, we note that the AO was wrong to observe that the expenses were allocated more to the non-eligible unit at Thane and expenses were lesser allocated to the eligible unit (Silvassa Unit) which occasioned the AO to allocate more expenses to Silvassa Unit. We note that the total expenses were to the tune of Rs.9,645.84 crores out of which Rs.5,237.93 crores pertained to the non 80IA Unit (Thane) and Rs.4,264.70 crores pertained to the 80IA Unit at Silvassa. Thus, it is seen that the expenses incurred by the assessee for Thane unit was 54.3% and 44% to the Silvassa Unit. Therefore, we are of the considered opinion that the AO erred in re-allocating the expenses and thus reducing the 80IA of the Act profits shown for the unit at Silvassa. Therefore, on the facts and circumstances we direct the AO to accept the computation of profit of the eligible unit at Silvassa as made by assessee and allow deduction accordingly.
Disallowance of the claim of deduction u/s 80-IA in respect of windmills installed at different locations - HELD THAT:- As relying on HERCULES HOISTS LTD. [2015 (5) TMI 825 - BOMBAY HIGH COURT] since the earlier year losses of the windmills were absorbed during those years and no losses were carried forward, for the initial year, the AO/Ld. CIT(A) erred in denying the claim. Therefore, we hold that the profits earned during the A.Y.2008-09 from the four (4) windmills would be entitled for deduction and the AO is directed to allow it as per law.
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2022 (6) TMI 1313 - ITAT DELHI
Income accrued in India - Addition treating the entire income of the assessee from technical handling as taxable in India after allowing 5% of ad hoc allowance for expenses - HELD THAT:- Upon careful consideration, we note that Hon’ble Delhi High Court in the case of the assessee for assessment years 2004-05 to 2008-09 [2017 (2) TMI 157 - DELHI HIGH COURT] answered the question of law Whether profits of the assessee from providing technical services to other airlines is covered by Article 8(1) and 8(4) of the Double Taxation Avoidance Agreement between India and Germany and by Article 8(1) and 8(3) of Double Taxation Avoidance Agreement between India and Netherland against the Revenue and in favour of the assessee.
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2022 (6) TMI 1310 - PUNJAB AND HARYANA HIGH COURT
Validity of reopening of assessment u/s 147 - order issued u/s 148A(d) - Whether at this stage of notice under Section 148, writ Court should venture into the merits of the controversy when AO is yet to frame assessment/reassemment in discharge of statutory duty casted upon him under Section 147 of the Act ? - HELD THAT:- The consistent view is that where the proceedings have not even been concluded by the statutory authority, the writ Court should not interfere at such a pre-mature stage. Moreover it is not a case where from bare reading of notice it can be axiomatically held that the authority has clutched upon the jurisdiction not vested in it. The correctness of order under Section 148A(d) is being challenged on the factual premise contending that jurisdiction though vested has been wrongly exercised. By now it is well settled that there is vexed distinction between jurisdictional error and error of law/fact within jurisdiction. For rectification of errors statutory remedy has been provided.
We find that there is no reason to warrant interference by this Court in exercise of the jurisdiction under Article 226/227 of the Constitution of India at this intermediate stage when the proceedings initiated are yet to be concluded by a statutory authority. Hence the writ petition stands dismissed.
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2022 (6) TMI 1309 - ITAT DELHI
Assessment u/s 153A - incriminating material found during search - addition by the Ld. CIT(A) by holding that in the absence of any incriminating material, the completed assessment could not be interfered with - HELD THAT:- We find that the Hon’ble Delhi High Court and the Delhi Benches of the Tribunal by following the decision of Hon’ble Delhi High Court in the case of CIT vs., Kabul Chawla (2015 (9) TMI 80 - DELHI HIGH COURT] has been consistently holding that in absence of any incriminating material, no addition could be made when the assessment orders have attained finality. Considering the totality of the facts and circumstances of the case and in absence of any contrary binding decision of jurisdictional High Court we find no reason to interfere with the order of Ld. CIT(A) and thus, we dismiss the ground raised by the Revenue.
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2022 (6) TMI 1308 - ITAT PUNE
Delayed deposit of employees’ share of EPF and ESI etc - HELD THAT:- We find that the identical issue was came up before this Tribunal in the case of Prashant Arun Sangai [2022 (6) TMI 1305 - ITAT PUNE] wherein the Tribunal decided the similar issue in favour of the assessee relying on the decision of CIT vs. Nipso Polyfabriks Ltd.[2012 (11) TMI 592 - HIMACHAL PRADESH HIGH COURT] held that as assessee did deduct employees’ share of EPF and ESI and paid the same after the due date under the respective legislations but before the time stipulated for filing return u/s 139(1) of the Act for the year under consideration. In our opinion, this issue is no more res integra in view of several judgments allowing deduction u/s 36(1)(va) of employees’ share of contribution deposited after due date under the respective Acts but before the date prescribed u/s 139 - Decided in favour of assessee.
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2022 (6) TMI 1305 - ITAT PUNE
Late deposit of the Employees’ share of EPF and ESI - disallowance in the intimation u/s.143(1) on the ground that the assessee late deposited the employees’ share of EPF and ESI etc. - difference between employees or employer’s contribution - Scope of amendment - HELD THAT:- This issue is no more res integra in view of several judgments allowing deduction u/s 36(1)(va) of employees’ share of contribution deposited after due date under the respective Acts but before the date prescribed u/s 139 - As in CIT vs. Nipso Polyfabriks Ltd. [2012 (11) TMI 592 - HIMACHAL PRADESH HIGH COURT] has held that there exists no difference between employees or employer’s contribution and both are to be allowed as deduction if deposited before the due date.
Finance Act, 2021 has inserted Explanation 2 below section 36(1)(va) providing that the provisions of section 43B shall not apply for the purpose of determining the due date under this clause w.e.f. 01.04.2021. The effect of this amendment is that if the amount of employees’ contribution towards EPF, ESI, etc is delayed by an employer beyond the due date under the respective Acts, the disallowance will be called for notwithstanding the fact that it was deposited before the due date u/s 139 of the Act.
Since the assessment year under consideration is 2019-20, which is anterior to the amendment carried out with effect from A.Y. 2021-22, we hold that the position of law as set out in CIT vs. Nipso Polyfabriks Ltd. (supra) squarely applies to the facts and circumstances of the instant case, thereby not warranting any disallowance since the amount in question was admittedly deposited before due date u/s 139(1) of the Act. The addition is therefore, directed to be deleted. - Decided in favour of assessee.
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2022 (6) TMI 1302 - ITAT CUTTACK
Validity of Assessment u/s 153C - evidences incriminating from search - loan given to family members - as argued seized material was not incriminating material and these were transactions which were recorded in the regular books and consequently no assessment u/s.153C of the Act is liable to be made - HELD THAT:- A perusal of the Annexure-A annexed to the satisfaction note, reproduced hereinabove, by the AO of the person searched shows that in the seized material SMLO-52, there is a ledger which contains the loan taken from IFCI Factors Ltd.
Admittedly, the ledger account is part of the regular books of the assessee and the same cannot be treated as an incriminating material. However, the information that the loan has been given to Shri Vikash Gupta and his family members out of the said loan taken by the assessee company from IFCI Factors Ltd. has come out of the evidence found in the course of search. The evidence in relation to the impugned assessment years have been found in the course of search on Shivom Minerals Ltd. but relating to the assessee. When evidence relating to the assessee has been found and the same has been made available by the AO of the person searched to the AO of the person in respect of whom the evidence has been found then the AO of the person in respect of whom the evidence has been found would have to examine the same.
Here, clearly evidence in the form of ledger and the transactions of giving the loan to Shri Vikash Gupta and his family members have been found and handed over to the AO of the assessee. Whether the said evidence is incriminating or not would have no bearing insofar as the AO of the searched person is concerned, but the evidence having been provided to the AO of the person in respect of whom the evidence has been found, it is the duty of such AO to examine and verify the same.
For the purpose of verification the only option available to the AO is to initiate the proceedings u/s.153C of the Act, for that relevant assessment years to which those evidence relate. That is exactly what the AO has done in the present case. Once the assessment is opened u/s.153C provisions of the regular assessments would come into play and such additions and disallowance as is possible under regular assessment would have to be done by the AO.
Again that is what the present AO has done. This being so, clearly evidence in relation to the relevant assessment years having been found in the course of search conducted in the premises of M/s Shivom Minerals Ltd. and its group, that such evidence having been provided to the AO of the assessee to whom such evidences were related to, the proceedings initiated u/s.153C of the Act are valid insofar as such evidence relates to the assessment years to which the evidences were found. Once the proceedings u/s.153C of the Act are initiated rightly, the consequential assessment is a forlorn conclusion. In these circumstances, we find no error in the order of the AO and that of the ld.CIT(A) on this issue. In view of the above, the additional grounds filed by the assessee stand rejected.
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2022 (6) TMI 1301 - CALCUTTA HIGH COURT
Reopening of assessment u/s 147 - notice u/s 148A(b) - No discussion on objection case of the petitioner that the impugned order is bad in law - HELD THAT:- On perusal of the aforesaid order u/s 148A(d) no reasoning or any discussion on the contention raised by the petitioner in its aforesaid objection.
Advocate appearing for the respondent could not justify the aforesaid impugned order by his submission.
Considering the submission of the parties, the aforesaid impugned order u/s 148A(d) and subsequent notice under Section 148 are set aside and the matter is remanded back to the AO concerned for passing a fresh order in accordance with law and by passing a reasoned and speaking order particularly by taking into consideration the objection of the petitioner within eight weeks from the date of the communication of this order.
Before passing any fresh order u/s 148A(d) petitioner or its authorised representative shall be given opportunity of hearing.
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