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Income Tax - Case Laws
Showing 21 to 40 of 748 Records
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2016 (3) TMI 1442 - ITAT BANGALORE
TP Adjustment - comparable selection - HELD THAT:- Companies functionally dissimilar with that of assessee deselected.
Exclusion on the ‘abnormal profits’- As seen from the order of CIT(A) the reasons for rejection are that they are having ‘negative margins’/ losses. Therefore, grounds raised by the Revenue are not maintainable. Hence, rejected.
Foreign Exchange Gain/Loss as operating in nature - HELD THAT:- This issue is held in favour of assessee and against Revenue in all the cases as the foreign exchange gain/loss is accruing as part of business activity and on the billing/billed amount. So, the same is rightly treated as part of operating income. M/S. CISCO SYSTEMS (INDIA) PRIVATE LTD. [2014 (11) TMI 849 - ITAT BANGALORE], SAP LABS INDIA (P.) LTD.[2010 (8) TMI 676 - ITAT, BANGALORE] AND M/S. GEM PLUS JEWELLERY INDIA LTD. [2010 (6) TMI 65 - BOMBAY HIGH COURT].
Deduction u/s 10A - exclusion of Telecommunication Charges for export turnover and total turnover - HELD THAT:- AO excluded the Telecommunications charges and Travelling charges from estimated turnover. Ld.CIT(A) following the Co-ordinate Bench decision has directed the AO to exclude the same from total turnover as well. This direction is as per the principles on the subject. The jurisdictional High Court in the case of CIT Vs. Tata Elxsi [2011 (8) TMI 782 - KARNATAKA HIGH COURT] has held that whatever is excluded from estimated turnover should also be excluded from total turnover. The direction of Ld.CIT(A) is upheld. Grounds are rejected.
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2016 (3) TMI 1441 - ITAT DELHI
Admission of the additional evidences furnished before the ld. CIT(A) - CIT- A denied admission - HELD THAT:- We find substance in the contentions of the ld. Counsel for the assessee. It is notable that even though the remand report of the AO was sought by the ld. CIT(A) on the said additional evidences, he finally did not admit such evidences for consideration. Such an action of the ld. CIT(A) is not justified in view of the proposition made in the case of Sahrukh Khan vs. DCIT [2006 (7) TMI 532 - ITAT MUMBAI]
CIT(A) had called for the remand report on the additional evidences so furnished, he has to admit the same on record for consideration on merits. CIT(A), however, failed to do so, but refused to admit the same, which is not tenable in view of the aforesaid decisions. We further note that factum of calling of remand report on merits of the additional evidences etc. does not arise in the case of Moser Bear India Ltd.[2008 (12) TMI 19 - DELHI HIGH COURT] relied upon by the ld. CIT(A). Therefore, the decision of Hon’ble Delhi High Court, in our opinion, does not help the Revenue, having been rendered in different context.
Besides, on perusal of the impugned order it reveals that the ld. CIT(A) has not passed speaking order on merits of the case also by recording his specific findings on the objections of the AO and the submissions of the assessee, but has simply endorsed the views taken by the AO in a very slip shod manner. Therefore, the issues under consideration need fresh adjudication by the Revenue authorities. Since the Assessing Officer has to examine the additional evidences in order to verify the sundry creditors and to examine veracity of depreciation claimed, it will be expedient in the interest of justice to restore the matter to the file of Assessing Officer for deciding both the issues de novo after considering the additional evidences noted above which shall be furnished by the Assessee before him in support of its claims. The Assessing Officer shall pass a speaking order in accordance with law - Appeal of the assessee is allowed for statistical purposes.
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2016 (3) TMI 1440 - ITAT DELHI
Correct method of accounting - Addition on account of recognizing the income by applying the percentage of completion method as per Accounting Standard-7 issued by ICAI - HELD THAT:- We note that assessee was following project completion method from the beginning for calculating its income from the projects and the department was accepting the same throughout, however, this year only the AO has not accepted this method without spelling out how this method distorts the projects. Admittedly, the assessee is not a contractor so revised AS-7 need not be followed by the assessee who is Real Estate Developer.
As the construction is completed up to 53.95%, therefore, the project was not complete and real profits cannot be estimated from the same. The ld. CIT (A) has rightly held that the AO has not pointed out any discrepancy that method followed regularly by the assessee was distorting or under estimating the profits and since no such facts and figures have been brought on record by the AO, therefore, the method regularly followed by the assessee cannot be interfered with. Therefore, the percentage completion method applied by the AO cannot be applied in the case of the assessee. Therefore, in view of the above, we do not find any infirmity in the order of the CIT (A) and accordingly, we uphold the same. - Decided against revenue.
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2016 (3) TMI 1439 - RAJASTHAN HIGH COURT
Penalty u/s 271(1)(c) - Whether the Tribunal was justified in holding that the prior approval taken for levy of penalty from Additional Commissioner does not fulfill the mandate under Sec.274 which provide for taking approval from Joint Commissioner in complete defiance of the definition of “Joint Commissioner of Income Tax” provided u/S.2 (28C) of the Act, which includes “Additional Commissioner of Income Tax ? - HELD THAT:- On a bare perusal of the above definitions and sec. 2(28C) read with 274(2) in particular, it is clear that 'Joint Commissioner' means a person appointed to the post of Joint Commissioner of Income-Tax and includes Addl. Commissioner of Income-Tax and granting approval by the Addl. Commissioner of Income-Tax u/sec. 274(2)(b) of the Act on a permission sought by the AO before imposing penalty u/sec. 271(1)(c), in our view is accorded by the authority competent under the law.
Taking into consideration above, the Tribunal in our view erred in quashing the penalty order merely on the premise that Addl. CIT does not find place in Sec. 274(2)(b) and imposition of penalty is bad and void ab initio.
Also contention raised by the learned counsel for the assessee about the Circular dated 10.12.2015. In our view the said Circular may not be applicable for the reason that the Revenue has assailed the penalty amounting to Rs.29,02,743/- and not only the penalty reduced by the CIT(A). Before the Tribunal, both the Revenue as well as the assessee preferred appeals and the entire penalty as referred to hereinbefore, was in issue before the Tribunal and now before this Court. Therefore, we reject the contention of the learned counsel for the assessee as the Circular has no application.
The judgments relied upon by the assessee basically are the principles of interpretation of the provisions of law, before us when the provision is self explicit clear and plain language is unambiguous, need no interpretation.
The judgment in the case of Brij Mohan [1979 (8) TMI 2 - SUPREME COURT] was a case relating to the change of law before and after amendment made in sec. 271(1)(c) clause (iii) of the Finance Act, 1968. In our view, this case is not relevant for the present purpose. - Decided against assessee.
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2016 (3) TMI 1438 - SC ORDER
Disallowance of payments of PF/ESIC paid beyond the due date prescribed under the relevant statutes - issue is squarely covered against the assessee by Gujarat High Court [2014 (1) TMI 502 - GUJARAT HIGH COURT] wherein it was held that section 43B does not apply to employees contribution.
HELD THAT:- Leave granted.
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2016 (3) TMI 1436 - ITAT MUMBAI
Deduction u/s 54F - Claim available for only one residential house purchased or constructed - deduction denied as assessee has utilized the net consideration for investment in two residential properties - assessee has not yet completed the entire residential house - HELD THAT:- Assessee will be entitled for benefit u/s 54F of the Act with respect to investment in only one residential house property at Parsik Hills, Belapur as the said residential house property is completed at later point of time vis-à-vis acquisition of the residential flat at NRI Complex, Nerul in November 2007 and the provisions of Section 54F(2) of the Act will get invoked and be applicable with respect to residential flat at NRI Complex, Nerul being acquired in November 2007 i.e. prior to completion of investment in residential house property at Parsik Hills, Belapur, and the investment in construction of residential house property at Parsik Hills, Belapur shall be entitled for benefit u/s 54F as the assessee has sold two plots of land and the AO has rightly allowed the exemption u/s 54F with respect of investment made by the assessee in the construction of the residential house property at Parsik Hills, Belapur.
Benefit u/s 54F of the Act of the investment in construction of residential house property at Parsik Hills, Belapur on the ground that the property was not in livable condition to occupy owing to non-production of evidence with regard to basic amenities like place for cooking/kitchen/toilet, bathroom, approach road within the plot etc. and non production of evidences regarding any electricity or telephone or tap water connection having been granted to the structure - The intention of the Legislature was to encourage investments in the acquisition of a residential house and completion of construction or occupation is not the requirement of law. The words used in the section are 'purchased' or 'constructed'. For such purpose, the capital gain realized should have been invested in a residential house. The condition precedent for claiming benefit under the said provision is the capital gain realized from sale of capital asset should have been parted by the assessee and invested either in purchasing a residential house or in constructing a residential house.Thus, benefit u/s 54F of the Act cannot be denied to the assessee during the year ending March, 2008 merely because the assessee has not yet completed the entire residential house at Parsik Hills, Belapur while the assessee can complete the house with a stipulated period of three years from the date of transfer of original asset, the deduction cannot be denied merely on the ground that construction is not completed . Our decision is fortified by the decision of Hyderabad- Tribunal in the case of Narsimha Raju Rudra Raju [2013 (11) TMI 415 - ITAT HYDERABAD]
Thus, in our considered view, the assessee shall be entitled for benefit u/s 54F of the Act with respect to investment made by the assessee in construction of residential house property at Parsil Hills, Belapur as allowed by the AO and we set aside the orders of the CIT(A) in this regard and restore the orders of the AO.
Assessing the agricultural income earned by the assessee as income under the head “income from other sources”- HELD THAT:- No details regarding procurement of seeds or labour or water for carrying out the agricultural operations has been produced by the assessee even in the second round of litigation. No details were produced with respect to the crop cultivated or produced from the agricultural land even by the caretaker - In the absence of any cogent material/evidence brought on record by the assessee with respect to the actual carrying on the agricultural activity in the said land stated to be agriculture land, the said income cannot be assessed to tax as ‘agricultural income’ and the same shall be charged to tax as ‘income from other sources’, hence this ground of appeal raised by the assessee is dismissed and the findings of the authorities below are confirmed. We order accordingly.
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2016 (3) TMI 1434 - ITAT PUNE
Deduction u/s. 80P(2)(c)(ii) - Disallowing deduction in respect of incomes earned by the assessee from Locker Rent, Ambulance Rent, Commission on Collection of MSEB bills and Health Club - HELD THAT:- We observe that on similar grounds the assessee has filed appeals before the Tribunal against the order of Commissioner of Income Tax (Appeals) for assessment years 2010-11 and 2011-12 [2016 (4) TMI 473 - ITAT PUNE] decided in favour of the assessee.
No material has been placed on record by the Revenue to controvert the findings of Coordinate Bench. In such circumstances, we do not find any reason to take any contrary view.
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2016 (3) TMI 1433 - ITAT MUMBAI
Revision u/s 263 - Deduction u/s 80IB(10) in respect of a project developed by it as per the approval given by the Slum Redevelopment Authority(SRA) for the project - As per CIT Assessee should be taken as a new project and not Slum Redevelopment scheme - HELD THAT:- It is an admitted fact that the assessee has not undertaken Slum Redevelopment Scheme, i.e., development of any existing slum. It has constructed flats as per the scheme framed by the SRA in accordance with their design in a open land. Hence we are of the view that the Ld CIT(A) was justified in holding that, for all practical purposes, it should be taken as a new project and not Slum Redevelopment scheme.
In the instant case, it is not shown that the assessee has not claimed relaxation of the conditions specified in clause (a) or (b) of section 80IB(10) of the Act by virtue of first proviso. Hence from this angle also, there is no requirement that the project of the assessee should be notified by CBDT.
Whether the assessee was a developer or builder? - We agree with the view taken by ld CIT(A) that the agreement entered between the assessee and SRA should be considered as a whole in order to ascertain the status. CIT(A), on examination of the agreement in whole, has taken the view that the assessee cannot be considered as a mere contractor simply for the reason that the land was conveyed to the SRA, since the assessee has taken up the entire responsibility to construct the tenements along with infrastructural facilities. The building so constructed was later handed over to the SRA. In consideration of the same, the assessee has got TDR. Hence, we are in agreement with the said observations of the Ld CIT(A) - the assessee could have been taken as a contractor, only if the SRA has taken up the responsibility to construct the building and the assessee was awarded the contract to construct the building. This is not the case here. The assessee has taken up entire responsibility of the project to develop and complete the project. Hence, the Ld CIT(A) was right in holding that the assessee was a developer in this project.
With regard to the observation of the AO that the assessee “appears” to have not completed the project before 31.3.2008, we notice that the very use of the word “appears” by the AO shows that he was also not sure about his allegation. In any case, the Ld CIT(A) has taken note of the possession certificate given by the SRA, as per which all the buildings were handed over to it before 31.3.2008, meaning thereby, the assessee has completed the construction before that date.
In view of the above, we do not find any infirmity in the order of Ld CIT(A) passed for AY 2007-08 and accordingly uphold the same.
AY 2006-07 challenging the revision order passed by Ld CIT u/s 263 - The order passed by Ld CIT(A) for assessment year 2007-08 would show that the issues considered by Ld CIT are debatable in nature, i.e., the view taken by the assessing officer for allowing deduction u/s 80IB(10) of the Act was a possible view. Accordingly as per the decision rendered in the case of Malabar Industrial Company [2000 (2) TMI 10 - SUPREME COURT] the impugned revision order is liable to be set aside, since the one of possible views taken by the AO would not render the assessment order prejudicial to the interest of the revenue. It is well settled proposition of law that the twin conditions specified in sec. 263 of the Act, viz., (a) assessment order is erroneous and (b) it is prejudicial to the interest of revenue, should be shown as existing before passing revision order u/s 263 of the Act. Further, on merits also, we have noticed that the various reasons cited by the AO/Ld CIT does not merit acceptance. Hence, the impugned revision order is liable to set aside.
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2016 (3) TMI 1431 - ITAT BANGALORE
TP Adjustment - comparable selection - HELD THAT:- Vishal Information Technologies cannot be considered as a comparable with the assessee-company. Hence, we direct the AO/TPO to exclude this company from the list of comparables for the purpose of bench marking the international transactions with its AE.
Saffron Global Ltd - The fact that there was a proposal for merger of this company with Triton Corporation and the accumulated losses are more than 50% of net worth, the internal controls require to be improved and increase in turnover is not a relevant factor for excluding this company as a comparable. These factors have no impact either on the comparability or profitability of the current year and therefore, we uphold the findings of the ld.CIT(A) and this ground of appeal filed by the assessee-company is dismissed.
Companies not comparable as they have related party transaction - The provisions of Section 92 provides that income arising from international transaction is to be computed having regard to ALP. Section 92F(ii) defines “arm’s length price” to mean a price which is applied or proposed to be applied in a transaction between persons other than associated enterprises, in uncontrolled conditions. To compute ALP the results of the international transaction are bench marked against comparable uncontrolled transaction. The mandate of s. 92F(ii) is that ALP shall be computed considering price applied or proposed to be applied in transactions between non- AE’s.
When selection of external comparables, one needs to ensure that such external comparables are uncontrolled. The companies having controlled transactions therefore needs to be eliminated. Then the issue that crops up is what should be the related party transaction ratio for excluding as comparable. This issue had come up before the Tribunal in numerous cases. The Delhi Coordinate Bench in the case of M/s Sony India Pvt. Ltd [2008 (9) TMI 420 - ITAT DELHI-H ], held that the companies having relating party transactions of not exceeding 15% can be taken as a comparable.
The law is fairly well settled to the extent that the companies having in related party transactions more than 15% cannot be considered as comparable. Accordingly, we are of the opinion that the ld.CIT(A) was not justified in holding that only the companies having no RPT should alone be considered. Therefore, we hold that Allsec Technologies, Transworks Information and Ace Software can be considered as comparable. However, Wipro BPO cannot be considered as a comparable on account of fact that it is substantial intangibles and enjoying huge goodwill - we hold that Wipro BPO cannot be considered as a comparable.
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2016 (3) TMI 1430 - ITAT BANGALORE
Accrual of income - interest on non- performing assets - year of assessment - whether interest on NPAs has also accrued to the assessee as on 31-03-2012 and is taxable? - CIT-A deleted the addition - HELD THAT:- As it is clear that this issue is covered by the judgment of the Hon’ble High Court in the case of CIT Vs Canfin Homes Ltd. [2011 (8) TMI 178 - KARNATAKA HIGH COURT] and by following the said judgment of the Hon’ble jurisdictional High Court this Tribunal has decided the issue in favour of the assessee for the assessment year 2010-11 [2015 (10) TMI 598 - ITAT BANGALORE] Following the earlier order of this Tribunal in assesee’s own case we do not find any error or illegality in the impugned order of the CIT(A) qua this issue.
Addition of interest on investments in government securities - assessee did not offer the interest accrued, but not due on government securities to tax - AO has made an addition by holding that the interest accrued but not due on government securities is income accrued to the assessee during the year under consideration and accordingly, brought the same to tax - HELD THAT:- It is clear that this issue is decided in favour of the assessee by this Tribunal by following the decision of the Hon’ble Kerala High Court in case of CIT Vs Federal Bank [2008 (1) TMI 195 - KERALA HIGH COURT] as well as the judgment of jurisdictional High Court in the cased of Karnataka Bank Ltd. [2014 (11) TMI 221 - KARNATAKA HIGH COURT] Following the earlier order of the Co-ordinate Bench of this Tribunal in assessee’s own case, we do not find any error or illegality in the impugned order of the CIT(A) on this issue. Hence, ground no.3.2 of the revenue is dismissed.
TDS u/s 194A - payment of interest on deposits - disallowance u/s 40(a)(ia) - Assessee paid interest on deposits from members and payment to each of the depositors exceeded a sum of ₹ 10,000 - CIT-A deleted the addition - HELD THAT:- CIT(A) has correctly deleted the disallowance made by the AO by following the decision of Bagalkot District Central Co-op. Bank Ltd [2015 (1) TMI 1005 - ITAT BANGALORE] wherein it was held that the Co-operative bank is covered by the exemption specified u/s 194A(3)(v) of the IT Act. Therefore, the co-operative bank is not required to deduct tax at source u/s 194A of the IT Act, 1961.
Disallowance of expenditure on the ground of non-business expenditure - CIT(A) allowed the claim of the assessee and deleted the disallowance - HELD THAT:- As relying on assessee's own case [2015 (10) TMI 598 - ITAT BANGALORE] taking into account the totality of the facts and materials, we are of the considered view that the assessee is entitled to claim this deduction and hence, we allow the grounds of the assessee relating to this issue.
Addition u/s 36(1)(viia) - disallowance of the claim of provision towards NPA - AO was of the view that Explanation to sec.36(1)(vii) of the IT Act, provides that any bad debt or part thereof written off cannot include any provision for bad and doubtful debts. The provision for NPA under the RBI direction is doubtful assets and accordingly, the AO disallowed the claim of the assessee - CIT-A deleted the addition - HELD THAT:- As it is manifest from the finding of the CIT(A) that the claim of the assessee was examined by the CIT(A) as per the provision of Sec.36(1)(viia) and accordingly, the AO was directed to allow the claim under the said provision after verification of the provisions made by the assessee and compliance of conditions provided u/s 36(1)(viia) of the IT Act, 1961. Accordingly, we do not find any reason to interfere with the impugned order of the CIT(A) on this issue and the AO is directed to consider and examine this claim u/s 36(1)(viia) - Decided against revenue.
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2016 (3) TMI 1428 - ITAT DELHI
Maintainability of appeal - low tax effect - HELD THAT:- This is an appeal filed by the Revenue. Admittedly the tax effect in this appeal by the Revenue is less than ₹ 10 lakhs.
In terms of CBDT Circular No.21/2015 dated 10th December,2015, F.No. 279/Misc./142/2007-ITJ(Pt.) read with S.268 A of the Income Tax Act 1961, this appeal by the Revenue should have been withdrawn or should not be pressed by the Revenue. In view of the above this appeal by the Revenue is dismissed in limini.
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2016 (3) TMI 1425 - ITAT PUNE
Revision u/s 263 by CIT - assessee firm was beneficiary of hawala transactions - lack of proper enquiry or case of lack of enquiry - case of the assessee was picked up for scrutiny - As per CIT AO had failed to verify the transactions and had accepted the books of account and the financial results at face value - HELD THAT:- AO issued a questionnaire to the assessee to furnish complete details in respect of purchases made by the assessee. In reply, the assessee not only filed date-wise details of purchases, but also filed confirmations from the parties from whom the said purchases were made. The said details include purchases made from Sampark Steels, Prayan Trading Co., Vitarag Trading Co. and Siddhivinayak Steel. The relevant details and information is filed by the assessee in the Paper Book - perusal of assessment order reflects that the AO had made elaborate enquiries in respect of transportation of purchases, where the Assessing Officer had considered all the particulars filed before him and had also noted the various aspects of transactions i.e. the transport of the goods purchased by the assessee and had also enhanced income in the hands of assessee. Merely because elaborate discussion has not been made by the Assessing Officer on this aspect does not make the order passed by the Assessing Officer as being accepting transactions at face value.
AO had made enquiries in the case and had discussed the aspect of transportation of goods in the assessment order elaborately, but had not discussed the information and details filed by the assessee with regard to purchases, does not make the order passed by the Assessing Officer to be a prima facie case of assumption of incorrect computation of income or under assessment of income. We find support from the ratio laid down by the Hon’ble Bombay High Court in CIT Vs. Gabriel India Ltd.[1993 (4) TMI 55 - BOMBAY HIGH COURT]
The order passed by the AO cannot be said to be erroneous or passed on assumption of incorrect computation of income on the ground that the Assessing Officer had failed to carry out the exercise of verification of transactions with the said four parties involving purchases.assessee himself has filed the confirmations from the said parties, which are available on record. Further, evidence of transportation of the goods also have been filed which have been taken note by the Assessing Officer and elaborately recorded the same in the assessment order. May be, it can be the case of lack of proper enquiry, but it is not the case of lack of enquiry and once enquiry has been made by the Assessing Officer and he has taken one view, the same cannot be set-aside by the Commissioner since he does not agree that the view taken by the Assessing Officer was a possible view. - Decided in favour of assessee.
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2016 (3) TMI 1424 - ITAT COCHIN
Non-appearance before the Tribunal on the date of hearing - HELD THAT:- At the time of hearing of this appeal none appeared on behalf of the assessee though the notice was sent through RPAD. The notice has been sent on the address given on Form No.36. The assessee has not intimated change of address, if any, to the Tribunal. There is not even an adjournment petition received from the assessee. In the circumstances, it appears that the assessee is not interested in pursuing the appeal, and no useful purpose would be served by adjourning the hearing. Considering these facts and keeping in mind the provisions of Rule 19(2) of the ITAT Rules, as were considered in the case of Multiplan India,[1991 (5) TMI 120 - ITAT DELHI-D] and in view of the decision Estate of Late Tukoji Rao Holkar [1996 (3) TMI 92 - MADHYA PRADESH HIGH COURT], we dismiss the appeal in limine. Appeal of assessee dismissed.
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2016 (3) TMI 1421 - ITAT HYDERABAD
Rectification of mistake u/s 254 - whether the findings in case of M/s. Madhucon Sino Hydro J.V. [2014 (2) TMI 138 - ITAT HYDERABAD] are ‘directions’ or ‘observations’? - HELD THAT:- This finding of ITAT was considered by Assessing Officer as direction of the ITAT and without following the due procedure as prescribed under the law initiated proceedings u/s. 163 and 147 of the IT Act. The ITAT in the impugned order ha s held that the same are null and void. While deciding, the ITAT elaborately discussed why the same cannot be considered as ‘direction’ in para 9 and even if it is considered as ‘direction’, why the same cannot be considered as legal.
Deficiencies in not recording a satisfaction, not taking approval from the prescribed authority and limitation of time in initiating proceedings were clearly discussed. Since the findings in the order are after due consideration and elaborate discussion, the same cannot come within the purview of ‘mistake apparent from record’. If there is any error of judgment, the same has to be challenged in a higher forum. The application clearly suggests that the decision taken require ‘review’ which is not within the purview of the provisions of Section 254(2). As rightly held in the case of Ramesh Electric Trading Co Ltd.[1992 (11) TMI 32 - BOMBAY HIGH COURT], the power of review of its own order is not with ITAT and so the application made is not maintainable.
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2016 (3) TMI 1420 - ITAT MUMBAI
TP Adjustment - deemed interest on delayed sale proceeds - scope of definition of international transaction under Section 92B - interest for delay of 16, 7 and 7 days in respect of these delays (180 days was taken as the benchmark of reasonable period for realization of debts) by computing interest @ 18.816% - impact of amendment in section 92B, by the virtue of Finance Act 2012 - HELD THAT:- As decided in RUSABH DIAMONDS [2016 (4) TMI 400 - ITAT MUMBAI] no ALP adjustments can be made, on the facts of this case, in respect of delay in realization of sale proceeds.
The amendment in Section 92B, at least to the extent it dealt with the question of issuance of corporate guarantees, is effective from 1st April 2012. The assessment year before us being an assessment year prior to that date, the amended provisions of Section 92 B have no application in the matter. - Decided in favour of assessee
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2016 (3) TMI 1418 - ITAT AHMEDABAD
Addition u/s 68, 69 and 69C - assessee failed to offer an explanation regarding the source credited in its Books of account as WIP - during the course of Survey u/s.133A of the I.T.Act on 13.03.2008, the partners of the assessee firm accepted ₹ 3,00,00,000/- as the receipt of the firm from undisclosed sources - As per AO unaccounted income offered by the assessee during the course of survey, no expenses can be claimed in any manner whatsoever, viz. by debiting corresponding expenses account and transferring it to work-in-progress account as done by the assessee - CIT-A deleted the addition - HELD THAT:- Both types of receipts, i.e. receipt through cheques and receipt through cash as “on-money” will arise as income to the assessee as soon as transfer of immovable property is executed and not before, or possession thereof is handed over and for this it is necessary that such immovable property should be in existence. Therefore, the Coordinate Bench in the case of M/s. D.R. Construction [2011 (4) TMI 1343 - ITAT AHMEDABAD] was of the considered view that “on-money” received by the assessee did not have the character of income but was only an advance like the one received through cheque. Both will become part of the sale consideration to the assessee simultaneously on either handling over the possession of the flats or on execution of transfer-deed whichever happens earlier. In the instant case, during the course of survey, the partners of the assessee-firm had stated that the amounts so disclosed was the business receipts. The Revenue has not brought on record any contrary material to controvert such statement. - Decided against revenue.
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2016 (3) TMI 1417 - ITAT DELHI
Reopening of assessment u/s 147 - Addition u/s. 68 - identity and credit worthiness of the subscribers to the share application money and genuineness of transaction, were not established satisfactorily - HELD THAT:- As reasons recorded by the AO/DCIT, Circle 17(1), New Delhi for reopening and the approval thereof by the Ld. Addl. CIT, Range-17, New Delhi, we are of the view that AO has not applied his mind so as to come to an independent conclusion that he has reason to believe that income has escaped during the year. In our view the reasons are vague and are not based on any tangible material as well as are not acceptable in the eyes of law.
AO has mechanically issued notice u/s.148 of the Act, on the basis of information allegedly received by him from the Directorate of Income Tax (Investigation), New Delhi. As applicable in the case of the assessee, we are of the considered view that the reopening in the case of the assessee for the asstt. Year in dispute is bad in law and deserves to be quashed. - Decided in favour of assessee.
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2016 (3) TMI 1415 - BOMBAY HIGH COURT
Removal of office objections - HELD THAT:- This matter was listed on board on 28.8.2014. At that time, it was noticed by this Court in its order dated 28.8.2014 that the Appellant had not bothered to remove the office objections and have the Appeal numbered. In the above view, this Court by order dated 28.8.2014 directed the Appellant to remove office objections within four weeks. However, we find that in spite of specific direction, the Appellant has not removed office objections till date. Appeal is dismissed.
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2016 (3) TMI 1413 - ITAT CHENNAI
Deduction u/s.10B - ‘manufacture’ defined u/s.2(29BA) - manufacture and usage of conversion of granite block into monuments - HELD THAT:- The main requirement of product is activity should be in manufacturing items and should result in transformation of the object or article or thing into a new and distinct object with different character. The granite raw block is mounted and with the process of cutting, clipping and polishing into a monument has distinct character and usage.
As considering the apparent facts, definitions, usage and the process of manufacturing, and assessee’s own case on the nature of business of manufacturing of monuments and the process of conversion of raw material into finished product is identified and saleable and we rely on Apex Court decision of Arihant Tiles & Marbles (P) Ltd [2009 (12) TMI 1 - SUPREME COURT] were the lordship has considered conversion of marble block into polished slabs and tiles constitutes manufacture and same analogy apply for process of granite block. Therefore, we are not inclined to interfere with the order of Commissioner of Income Tax (Appeals) who has dealt the issue in detail viz-a-viz the explanations of the assessee and we uphold the order of the Commissioner of Income Tax (Appeals) and dismiss the Revenue appeal.
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2016 (3) TMI 1412 - ITAT MUMBAI
Stay of the recovery of the impugned balance/tax amount and interest - As stated that the impugned demand has been made by the AO taking into consideration the expected profits from his business of distributorship of Sony Channels estimated for seven years whereas the assessee has actually acquired the ownership rights of the channels after 4 years - as stated that if the demand raised by the AO on estimation basis for 7 years is considered for 4 years as the assessee has obtained the ownership rights of the channels after 4 years, in that event, the resultant figure will result into refund due to the assessee - HELD THAT:- We find that there is a prima-facie case in favour of the assessee. We therefore stay the recovery of the balance taxes including interest etc. relevant to the assessment year under consideration for a period of six months or till the disposal of the appeal of the assessee on merits, whichever is earlier.
The appeal is fixed for an early hearing on 14.06.16 - assessee will not contribute in delaying the hearing of the appeal and will not take any unnecessary adjournments in default, the stay will be deemed to be vacated. Our above observations will not have any bearing on merits of the case at the time of its final disposal.
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