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Income Tax - Case Laws
Showing 61 to 80 of 163549 Records
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2024 (4) TMI 834
Disallowance of set off - sale of equity shares (STT) - short-term capital gains (STCG) on sale of derivatives and short-term capital loss (STCL) - difference in rate of taxation - determining the tax liability without setting off of STCG loss taxable at the rate of 15% against the STCG on sale of derivatives taxable at the rate of 30% u/s 70(2) - HELD THAT:- In the case of VEMF-A, LP [2017 (4) TMI 721 - ITAT MUMBAI] wherein on identical issue and similar fact the ITAT has decided the issue in favour of the assessee. It is clearly held that under the provisions of section 70(2), STCL arising from any asset can be set off against STCG arising from any other asset under a similar computation made irrespective of different rate of tax. Therefore, the issue in appeal in the case of the assessee is squarely covered by the decision of the ITAT. Thus, we allow the appeal of the assessee.
In the result, the appeal of the assessee is allowed.
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2024 (4) TMI 808
Assessment barred by limitation - delay of 340 days in filing the present special leave petition - HC [2023 (1) TMI 1368 - CALCUTTA HIGH COURT] held provisions of Section 153(3)(ii) of the Act are not attracted in the facts and circumstances of the case on hand - HELD THAT:- We are not satisfied with the reasons given for the delay.
Accordingly, the application for condonation of delay, as well as, the special leave petition are dismissed.
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2024 (4) TMI 807
Condonation of delay - gross delay of 597 days in filing the special leave petition - Exemption u/s 11 allowed on activity of the assessee of letting out gallery frequently for a price as merely because a small percentage of the income of the Assessee is from letting out of its premises and sale of paintings, the essential activity of the Assessee would not cease to be charitable for the purposes of Sections 11 and 12
HELD THAT:- The explanation offered is not to our satisfaction as no sufficient cause to condone the delay has been made out. Hence, the application seeking condonation of delay is dismissed. Consequently, the Special Leave Petition is dismissed on the ground of delay keeping open the question of law, if any, which arises in this matter.
Pending application(s) shall stand disposed of.
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2024 (4) TMI 806
Allowable expenditure of "Education Cess” - HELD THAT:- As respondent very fairly states that in view of the subsequent amendments in the Income Tax Act, 1961, “Education Cess” cannot be allowed as an expenditure.
In view of the statement made, the impugned judgment is set aside and the appeal is allowed, holding that the “Education Cess” cannot be allowed as an expenditure.
However, the assessing officer while implementing and giving effect to this order, will examine the question of the quantum/amount of “Education Cess”, if any, claimed by the respondent – SESA Goa Ltd., as an expenditure in the returns or in the proceedings.
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2024 (4) TMI 805
Waiver of interest u/s 234A, 234B and 234C - marginal delay in filing the returns - HELD THAT:- The stand of the petitioner that the petitioner was entitled for waiver of interest u/s 234A for the AY 2008-2009 and 2009-2010 on similar for the AY 2005-2006 and 2007-2008 deserves to be accepted, as there is only marginal delay in filing the returns after the Audit Report was received by the petitioner from the Office of Joint Director of Cooperative Audit on 22.03.2011 for the AY 2008-2009 and on 31.01.2012 for the AY 2009-2010. The returns for these years were filed by the petitioner on 31.05.2011 and 02.04.2012, respectively. Therefore, to the extent of rejection of waiver of interest u/s 234A is concerned, the impugned order warrants interference, by granting waiver to the petitioner. Therefore, the interest u/s 234A deserves to be waived and therefore, this Writ Petition deserves to be allowed to that extent.
Interest u/s 234B and 234C - They pertain to belated payment of advance tax under Section 210 within the stipulated period under Section 211 of the Income Tax Act, 1961. No case is made out by the petitioner for waiver of interest notwithstanding the reason stated by the petitioner in the affidavit. CBCT Circular No.400/129/2002-IT(B), dated 26.06.2006, does not specifically deal with waiver of interest u/s 234B and 234C of the Income Tax Act, 1961.
There were no impediments operating against the petitioner from paying the advance tax within the time line under Section 211 of Income Tax Act, 1961. The decision of this Court in Tvl.Sanmac Motor Finance Ltd. case [2020 (2) TMI 1182 - MADRAS HIGH COURT] which was relied by the learned counsel for the petitioner as also by the learned Senior Standing Counsel for the respondents, has not given a complete waiver of interest under any of the provisions although partial waiver was allowed.
That apart, the payment of interest on the tax that was payable on the date specified in Section 211 is axiomatic in the sense it has to be paid by the due date prescribed under the Statute and therefore, there cannot be any waiver either on the ground of equity or on a reading of the above Circular dated 26.06.2006, bearing reference No.400/129/2002-IT(B) or on a reading of the decision of this Court in Tvl.Sanmac Motor Finance Ltd. case [cited supra] or on a reading of the decision of the Hon'ble Supreme Court in Commissioner of Income Tax, Mumbai vs. Anjum M.H. Ghaswala and others [2001 (10) TMI 4 - SUPREME COURT]
Writ Petition is partly allowed.
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2024 (4) TMI 804
Validity of assessment order - as argued without giving the petitioner an opportunity to reply by granting adjournment, the second respondent has now passed the assessment order by adding a further sum towards addition u/s 68 - petitioner requested for adjournment in response to the earlier show cause notice which was denied - HELD THAT:- Without giving the petitioner an opportunity to reply by granting adjournment, the second respondent has now passed the assessment order by adding a further sum towards addition u/s 68 of the Income Tax Act, 1961. Thus, the impugned order has been passed in violation of principles of natural justice. Therefore, it is liable to be interfered with under Article 226 of the Constitution of India.
Accordingly, the impugned order passed by the first respondent is quashed and the case is remitted back to the first respondent to pass fresh orders within a period of 90 days from the date of receipt of a copy of this order. It is made clear that the impugned order and the show cause notice shall be read compendiously and a reply to the same shall also be filed by the petitioner within a period of 30 days from the date of receipt of a copy of this order
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2024 (4) TMI 803
Estimation of income - bogus purchases - quantification of profit - Rejection of books of accounts - HELD THAT:- Admittedly the addition in the hands of the assessee is liable to be restricted only to the extent of the profit which he would have made by procuring the goods at a discounted value from the open/grey market as against the inflated value at which he had recorded the same on the basis of bogus bills in his books of account. In so far the issue of quantification of profit which the assessee would have made by procuring the goods in question from the open/grey market is concerned, we find that the Hon’ble High Court of Bombay in the case of Pr. Commissioner of Income Tax-17 Vs. M/s. Mohhomad Haji Adam & Company [2019 (2) TMI 1632 - BOMBAY HIGH COURT] had observed, that the addition in the hands of the assessee as regards the bogus/unproved purchases was to be made to the extent of bringing the G.P rate of such purchases at the same rate of other genuine purchases
As identical facts the issue to the extent of quantification of the profit element in case of bogus/unverified purchases had come up in the case of M/s. Gopal Rice Industries [2023 (1) TMI 363 - ITAT RAIPUR] wherein restrict the addition in the hands of the assessee qua the impugned bogus/unverified purchased by bringing the GP rate of such bogus purchases at the same rate as that of the other genuine purchases.
Thus we restore the matter to the file of the A.O, with a direction to him to restrict the addition in the hands of the assessee qua the impugned bogus/unverified purchases by bringing the GP rate of such bogus purchases at the same rate as that of the other genuine purchases. Appeal of the assessee company is allowed for statistical purposes
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2024 (4) TMI 802
Reopening of assessment - scope of new regime of reopening of assessment after introduction of provisions of section 148/148A - notices issued for assessment years 2013-14 to 2015-16 - Limitation provided in section 149 - where the escaped income is less than Rs. 50 lakhs - HELD THAT:- We noted that admittedly the notice issued u/s. 148 of the Act either on 19.03.2021 or 13.04.2021, whether these are issued on 19.03.2021 i.e., extended, that falls in extended period or fresh notice issued on 13.04.2021 is of no relevance for adjudication on this issue. In either of the notice, the assessment was framed and Revenue’s contention is that the notices u/s. 148 of the Act is valid under the new regime of reopening of assessment after introduction of provisions of section 148/148A of the Act.
We have gone through the assessee’s paper-book and examined the facts and noted that admittedly escaped income is Rs. 29,20,000/- only. Now this issue has been clarified by CBDT explaining the judgment of Hon’ble Supreme Court in the case of Ashish Agarwal [2022 (5) TMI 240 - SUPREME COURT] implementation of by lower authorities and accepted the position that notices cannot be issued for assessment years 2013-14 to 2015-16, wherever income escaping assessment in that year, amounts to or is likely to amount to less than fifty lakh rupees. In the present case before us, the amount is Rs. 29,20,000/-. This issue is squarely covered by the decision of Hon’ble Supreme Court in Ashish Agarwal, supra, in favour of assessee and subsequently, issued instruction by CBDT and hence, we quash the notice issued u/s. 148 of the Act dated 13.04.2021 or 19.03.2021 as without jurisdiction.
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2024 (4) TMI 801
Levying penalty u/s. 271(1)(c) - as assessee has concealed the income by declaring the remuneration and interest on capital as gross receipts and declared the same u/s. 44AD and claimed to have been earned profit @ 8% - AO noted that the assessee ought to have declared the same as business income instead declared u/s. 44AD of the Act, which he did only to evade tax on interest and remuneration from the firm - AO noted that this issue was detected during assessment proceedings and he has not declared the income on his own but after detection it was declared and paid taxes
HELD THAT:- Admittedly, the assessee has filed information in the return of income in regard to remuneration and interest on capitals received from the partnership firm - This fact is disclosed by assessee in its original return of income and original return of income was processed u/s. 143(1) of the Act but assessee claimed these two items i.e., remuneration received as a partnership firm and interest on capital receipt from partnership firm on presumptive basis u/s. 44AD of the Act and declared net profit @ 8%.
We agree with the argument of ld. Senior DR that the assessee cannot make such claim and this is not allowable and this position has been clarified in the case of Anandkumar [2020 (12) TMI 994 - MADRAS HIGH COURT]. But, we noted that all the facts relating to these two claims made by assessee are available before the AO and even the AO processed the original return and accepted the claim, which may be wrong.
We have gone through the decision of Reliance Petroproducts Ltd. [2010 (3) TMI 80 - SUPREME COURT] wherein the Hon’ble Supreme Court has propounded “the meaning of the term ‘particulars’ used in section 271(1)(c) would embrace the details of the claim made. Where no information given in the return is found to be incorrect or inaccurate, the assessee cannot be held guilty of furnishing inaccurate ‘particulars’. In order to expose the assessee to penalty, unless the case is strictly covered by the provision, the penalty provision cannot be invoked. By no stretch of imagination can making an incorrect claim tantamount to furnishing inaccurate ‘particulars’”.
Mere fact that the claim of the assessee has been negated by the AO, it does not amount to concealment of income or furnishing of inaccurate particulars of income by the assessee. In the present case before us also, the assessee has disclosed complete particulars of income relating to remuneration received from firm and interest on capital invested with the firm. Once this is a fact, it means that there is no issue as regards to concealment of particulars of income.
Thus in the present case, the particulars are declared by assessee in his return of income and the assessee has only claimed those items as business receipts instead of declaring it as profit on gross basis. Thus this is not a fit case levy of penalty u/s. 271(1)(c) of the Act. There is no concealment of particulars of income or new evidences found by the AO for making any kind of addition. Appeal filed by the assessee is allowed.
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2024 (4) TMI 800
Validity of notice issued u/s 143(2) by the Non-Jurisdictional AO - No objection were filed within one month u/s 124 - Unexplained credits addition u/s 68 r.w.s. 115BBE as amount received on sale of shares unexplained - HELD THAT:- It is nowhere disputed by the Revenue that the notices issued in this regard were from non-jurisdiction AO. Only defence made out by the Revenue is that there was no objection within one month as per section 124 made by the assessee during assessment proceedings, thus section 292BB supports the case of the Revenue.
We are in agreement with the submissions of assessee wherein by placing reliance upon the case of ITO vs. Almak Finance P. Ltd. [2020 (10) TMI 795 - ITAT DELHI] it was held that when authorities have no jurisdiction over the assessee, the act done by such authority is bad in law and void ab initio. Thus, it is the claim of the assessee that by not disputing jurisdiction u/s 124 (3) of the Act, right to challenge the jurisdiction will not be lost forever, thus the defect is not curable u/s 292B & 292BB.
Thus we hold that AO did not have jurisdiction and accordingly, the assessment order is liable to be quashed as such. Therefore, by holding that notices were issued from non-jurisdictional AO, the assessment order is hereby quashed. Appeal of the assessee is allowed.
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2024 (4) TMI 799
Addition u/s 40A(3) - Cash expenditure - assessee has made payments to the land owners exceeding INR 20,000/- - HELD THAT:- Only 20% of the expenditure would be disallowed in the event of any payment of such expenditure made in cash which exceeded INR 20,000/-. The contention of the assessee is that the payments were made out of business expediency, is not supported by any evidences.
Therefore, the case laws relied by assessee, do not help him under the facts of the present case. However, we are in agreement with assessee that the expenditure should have been restricted to the extent of 20% in terms of extant provision of section 40A(3) of the Act. We therefore, direct the AO to restrict the disallowance to the extent of 20% of the total expenditure which was incurred in cash and exceeded the prescribed monetary limit i.e. INR 20,000/- of the same. Grounds raised by the assessee are accordingly, partly allowed.
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2024 (4) TMI 798
Income taxable in India or not - Salary income - incomes deemed to accrue or arise in India as assessee is a non-resident - income earned under head "Salaries" for services rendered in Australia employment - HELD THAT:- In the instant case the assessee neither had any rest period nor leave period which is preceded and succeeded by the services rendered outside India. Since, the assessee has rendered services outside India, the salary cannot be taxable in India.
As per the definition the salary paid or the advances received are to be included in the total income of the person when the salary becomes due.
From the concurrent reading of Section 5 dealing with scope of total income, Section 15 dealing with computation of total income under the head salary and chargeability thereof and Section 9 dealing with income arising or accruing in India with reference to the salaries and the services rendered in India, we hold that no taxability arises on the salary/allowances received by the assessee since the assessee is a non-resident and has rendered services outside India.
Thus, the Assessee is eligible for exemption on his salary for services rendered in Australia employment exercised in Australia during his Australia assignment period. In the result, the appeal of the assessee is allowed.
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2024 (4) TMI 797
Unexplained cash receipt u/s 69A - Unexplained income found in search - during the course of search, a digital evidence under ID marked was seized which is the mobile data backup of one of the employees of the assessee concern - HELD THAT:- It remains admitted facts that the ld. AO did not make any independent third party enquiry. It prima facie seems to be a transaction for which the assessee may have received advances but finally transaction did not materialize and the accounts may have been settled. There is no evidence to show that the alleged sum is in the nature of unexplained income or unexplained sales of the assessee. Therefore, the finding of the ld. CIT(A) that the impugned addition has been based on conjectures and surmises and not having any reference to tangible/credible material, needs no interference at our end. Accordingly, the sole grievance raised by the revenue is dismissed.
Assessment u/s 153A - incriminating material found as a result of search or not? - HELD THAT:- Assessee has challenged the assumption of jurisdiction u/s 153A of the Act on the ground that it is not based on any incriminating material found as a result of search on the assessee. We fail to find any merit in the grounds of appeal raised in the cross-objection since there was a material, incriminating in nature in the form of digital evidence under ID marked MB/HD/01, which gave jurisdiction to the AO to carry out the assessment proceedings. Thus, all the grounds raised in the cross-objections are dismissed.
Unexplained expenditure u/s. 69C - assesses has failed to explain the transactions mentioned in the incriminating material (MB/HD/01) seized from the assessee's premises during the course of search - HELD THAT:- As per the audited books of accounts for FY 2017-18, the closing balance of M/s. Sati Oil Udyog Limited as on 31/03/2018 cannot be doubted. These audited financial statements were part of the income tax return filed by the assessee much prior to the date of search. Therefore, genuineness of the closing balance of M/s. Sati Oil Udyog Limited is established.
The remaining amount, two fold contentions have been made by the ld. A/R. Firstly, that there is a payment during financial year 2018-19 but it has been wrongly considered by the accountant preparing ledger appearing in the seized documents MB/HD/01 in FY 2017-18, then the alleged balance will be reconciled. Second fold of contentions is that the assessee had already offered additional income and against this additional income, the assessee has urged for telescoping benefit - We find merit in the second fold of contention and agree with the finding of the ld. CIT(A) that the assessee deserves telescoping benefit against the additional income offered to tax. Accordingly, Ground No. 1 raised by the revenue is hereby dismissed.
Set off of unexplained expenditure against the additional income offered in the Income tax return - HELD THAT:- We fail to find any inconsistency in the finding of the ld. CIT(A) in holding that since the additional income offered was not specific and it was open for the assessee to claim telescoping benefit for unexplained expenditure and, therefore, CIT(A) has rightly given the set off against the additional income disclosed in the additional income. Accordingly, Ground No. 2 raised by the revenue is dismissed.
Unexplained expenditure u/s 69C - seized material there were certain entries found in the form of summary of payments - HELD THAT:- We observe that no specific date is appearing in the incriminating material for the alleged transactions. There is no reference of any date which could remotely link the impugned payment to impugned Assessment Year. The presumption of the AO that the alleged sum is adjusted against the sale consideration itself shows that it is part of the sale consideration duly accounted for in the books. Thus, CIT(A) rightly referring to these facts has come to the conclusion that the ld. Assessing Officer erred in making this impugned addition which has been made without any basis and without considering the facts that the alleged sum has been paid through banking channel duly accounted for in the regular books of accounts. Ground No. 1 raised by the revenue is dismissed.
Unexplained cash received back - HELD THAT:- We on perusal of the finding of the ld. CIT(A) and submissions of the assessee take note of the fact that the alleged sum received from M/s. Krishna Udyog were found entered in the regular books of accounts in Tally software. It was just a matter of reconciliation of statements between M/s. Krishna Udyog and ld. CIT(A) for which the ld. CIT(A) had already directed the Assessing Officer to carry out the necessary verification. Thus, no interference is called for in the finding of the ld. CIT(A). Accordingly, Ground No. 2 raised by the revenue is dismissed.
Addition under the head “undisclosed profit” - AO on examining the seized data MB/HD/04 which consists of tally data of the group and on analyzing the tally accounts for FY 2019-20 came to the conclusion that assessee has suppressed two digits while making the accounting - HELD THAT:- On going through the above finding and also observing that the assessee had offered income more than the income as per the seized tally data, there was no room available to estimate higher profit without placing any evidence of suppressed sales or inflated expenditure. We thus, fail to find any infirmity the finding of the ld. CIT(A) and accordingly dismiss Ground No. 3.
Estimation of income - Bogus purchases - CIT(A) on considering the fact that sales of the assessee are not in dispute, work contracts have been executed and even if the purchases are bogus billings, there is actual purchase during the year for effectively completing contract work and only disallowed 5% of the total purchases - HELD THAT:- There is no evidence on record to prove that the assessee has shown bogus sales bills or bogus works contracts as the transactions are carried out through proper banking channels and registered vendors. Turnover declared by the assessee has been accepted by the ld. Assessing Officer. Once it is admitted that the figure of turnover is correct and the works contract/sales have been achieved by supplying material or completing the construction work it has to be accepted that for achieving the sales contract/work contract, expenditure has to be incurred. Thus, the ld. CIT(A) has taken a fair approach and after considering the past profit trend and the books of accounts being regularly maintained and duly audited, has rightly disallowed the purchases @5% sustaining the disallowance and giving part relief to the assessee.
Unexplained money - AO based on the seized document MB-06 having reference “Commission Jorhat to Guwahati”, inferred that there is a cash transfer against fixed commission - As per the assessee, this can be entry of discount/commission of Rs. 500/- per tonne of iron and steel from some person or firm - HELD THAT:- Neither any staff has confirmed the analogy drawn by the ld. Assessing Officer nor any document was seized or any reference has been made through regular books. In absence of any plausible explanation given by the Assessing Officer for decoding the entries appearing in page 13 of MB-06, we fail to find any infirmity in the finding of the ld. CIT(A) deleting the addition observing that in absence of any finding of suppression of double-digit in respect of any amount, the impugned amounts have to be taken on the face value. Accordingly, Ground No. 1 raised by the revenue is dismissed.
Addition unexplained cash back received - CIT(A) deleted addition - HELD THAT:- Since the assessee deserves telescoping benefit of the alleged sum against the additional undisclosed income offered in the return of income, we find no infirmity in the finding of the ld. CIT(A).
Estimation of income - bogus purchases - HELD THAT:- After taking into consideration the consistent carrying on of the same business of works contract, turnover not disputed by the revenue authorities, better net profit percentage and the fact that for achieving turnover, purchases are required to be made, we confirm the view taken by the ld. CIT(A) sustaining the disallowance @ 5% of the total bogus purchases.
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2024 (4) TMI 796
Taxability of income in India - Addition of receipt emanating from offshore supplies of escalators and elevators - assessee has claimed that the aforesaid receipt was not taxable in India on the ground that they pertained to off-shore supplies of equipment to DMRCL and MMRCL - AO was of the view that the contract with DMRCL and MMRCL was composite and indivisible and could not be split up into supply and commissioning parts as stated by the assessee and that the said consortium was liable to be assessed as an Associate of Person (AOP) and the income from the transaction was chargeable to tax in India, as no benefit of India-China DTAA could be granted to the association - HELD THAT:- As decided in own case [2023 (3) TMI 319 - ITAT MUMBAI] assessee did not carry out any operations in India in respect of its scope of work, therefore, we are of the considered opinion that the income earned by the assessee from the offshore supply of escalators and elevators to DMRCL and MMRCL is not taxable in India. Accordingly, we direct the Assessing Officer to delete the addition made in the hands of the assessee. As a result, ground No. 1 raised in assessee’s appeal is allowed.
Refund - Non receipt of funds granted by the AO - During the course of appellate proceedings before us the ld. Counsel submitted assessee has not issued refund as determined in the intimation issued u/s 143(1) of the Act - HELD THAT:- After hearing both the sides we direct the AO to determine the refund after verification of the relevant supporting material as claimed by the assessee. Therefore, this ground of appeal of the assessee is allowed for statistical purpose.
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2024 (4) TMI 795
Eligibility of Deduction u/s 80P - bank interest earned from cooperative banks - Assessee is a co-operative society primarily engaged into arranging for prompt payment to beneficiaries of diseased employees - HELD THAT:- The income earned by a co-operative society by way of interest derived by from its investment with any other cooperative society, then the whole of such income is deductible. Further the amount of interest received by the assessee from the different cooperative banks; it is not the claim that those banks are also not cooperative societies.
It is agreed that those are also the cooperative bank in terms of The Banking Regulation Act, 1949. Therefore even if it is accepted that bank interest on from cooperative banks by the assessee is not the income from the business of the assessee and therefore the claim of the assessee fails under section 80P(2)(a) of the act, but the claim is still allowable and therefore cannot be denied u/s 80P(2)(d) of the act. This issue is also covered in favour of the assessee by the decision of Kerala State Co-Operative Agricultural & Rural Development Bank Ltd. [2023 (9) TMI 761 - SUPREME COURT] where the deduction was allowable to the state level agricultural and rural development bank, was engaged in providing credit facility to its members .
The case of the assessee is on far better footings that these are society of only the employees of Indian oil Corporation. In view of the above facts, we direct the learned lower authorities to allow the deduction to the assessee on interest income earned from various cooperative banks under section 80P(2)(d) of the act. - Appeals of the assessee are allowed.
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2024 (4) TMI 753
Correct head of income - True character of the income - Income from leasing or letting out the properties in shopping-cum-entertainment Mall - “income from business” or “income from house property” - ITAT held that where the letting out the property is the main object of a company, its income is to be computed under the head “income from business” and it cannot be treated as “income from house property”, affirmed the order passed by the CIT (A)
HELD THAT:- AO did not find any material against the assessee to come to the conclusion that sub-leasing of the premises was only a part of its predominant object of the assessee. The respondent’s right from the construction of mall till the matter was taken into scrutiny had been offering income from the business of constructing, owning, acquiring, developing, managing, running, hiring, letting out, selling out or leasing multiplex, cineplex, cinema hall, theater, shop, shopping mall etc., sub-licence by it under the head “profit and gain of business or profession” of the Income Tax Act. Therefore, the CIT (A) as well as ITAT have rightly set aside the order of A.O.
The Apex Court in case of Raj Dadarkar and Associates [2017 (5) TMI 586 - SUPREME COURT] has held that ITAT being a last forum insofar as factual determination is concerned, these findings have attained finality. No material has been produced even before us to show how the aforesaid findings are perverse.
The order passed by A.O. nowhere shows that the entire income or substantial income of the assessee was from letting out of the properties, which is admittedly not the principal business activity of the assessee. Therefore, we do not find any perversity in the findings recorded by the ITAT as well as the CIT (A) and also do not find any substantial question of law involve in these appeals.
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2024 (4) TMI 752
Validity of reopening of assessment - appeals for Assessment Years 2011-2012, 2013-2014 and 2014-2015 were pending before the ITAT and as the assessment was getting time barred and to safeguard the interest of the Revenue, the assessment was reopened on 3 issues i.e., 8% profit treating contractor, Proportionate income and Capital gain - HELD THAT:- Admittedly, the ITAT has now held against the Revenue. Therefore, the entire basis for reopening has collapsed. The Revenue’s case that an appeal has been filed in this Court challenging the orders passed by the ITAT for Assessment Years 2011-2012, 2013-2014 and 2014-2015 will not be of any help because admittedly there is no stay.
As held in Union of India v/s. Kamlakshi Finance Corporation Ltd. [1991 (9) TMI 72 - SUPREME COURT] the principles of judicial discipline require that the orders of the higher appellate authorities should be followed unreservedly by the subordinate authorities and the order is the subject matter of an appeal can furnish no ground for not following it unless its operation has been suspended by a competent Court. Admittedly, the order of the ITAT, which is challenged in appeal in this Court, has not been suspended. Therefore, the order of the ITAT is certainly binding on the Revenue.
Respondents also submitted that assessment can be opened on the basis of order passed in another assessment year which is a settled position in law. Though we will not enter into a debate with him/Respondents on this aspect, still to issue notice itself the Revenue has to, in the facts of the case, cross the first hurdle of the proviso u/s 147 of the Act and if they do not, as we have observed above, the reopening will be bad in law.
We hereby quash and set aside the impugned notice. Consequently the order on objections also is hereby quashed and set aside.
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2024 (4) TMI 751
Addition u/s 68 on account of share capital and premium - addition made on absence of identity of the creditors, genuineness and creditworthiness of the entire transaction - ITAT deleted addition - HELD THAT:- Findings recorded by the Tribunal, is not supported by facts. AO has held that the assessee was a Private Limited company which cannot issue shares in the same manner in which Public Limited company does and in so far as creditworthiness of the share subscribers is concerned, there must be positive evidence to show the nature and source of resources of the share subscribers and if the assessee was serious enough to establish his case, it ought to have complied with the notices/letters issued by the Assessing Officer and ought to have produced the directors of the subscribing companies before the AO so that they could explain the sources from which the share subscription was made.
As stated that there is no complaints either from the end of the assessee company or from the end of the alleged subscriber company. This finding recorded by the AO as affirmed by the CIT(A), if required to be set aside by the Tribunal, reasons have to be assigned. Therefore, we find that the conclusion arrived at by Tribunal is insufficient to support its ultimate conclusion in allowing the assessee’s appeal. Therefore, we are of the view that the matter has to be remanded back to the Tribunal for fresh consideration.
Revenue appeal is allowed. The order passed by the learned Tribunal is set aside and the matter is remanded to the Tribunal to take a fresh decision.
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2024 (4) TMI 750
Revision u/s 263 - CSR expenses admissibility as the deduction u/s 37(1) - assessee is public sector undertaking - Tribunal on fact concluded that it is not a case of no enquiry and nor it is a case of non-application of mind - HELD THAT:- ITAT's factual finding cannot be dislodged in an appeal filed u/s 260A where we are required to answer substantial questions of law for consideration.
With regard to the admissibility of the expenses u/s 37(1) Tribunal has taken note of the decision in the case of Hindustan Copper Limited. [2020 (1) TMI 1324 - ITAT KOLKATA] the facts of the said case is also on the similar line as in the said case the assessee was a public sector undertaking and certain directives issued by the Government of India was followed by the assessee. There are two notifications issued by the Government of India, the first of which is by Office Memorandum dated 21.06.2011, wherein the expenses incurred by public sector undertakings in the form of fee charged for participation in CSR Training Programme/Workshops or for sponsorship of Workshops/programmes organized by Tata Institute of Social Sciences etc. will be allowed to be included under the CSR Budgets of Central Public Sector Enterprises. The other notification is dated 1st November, 2011 which stipulates the guidelines on Corporate Social Responsibility for Central Public Sector Enterprises. Admittedly, the respondent assessee has complied with the said directives issued by the Government of India.
Identical issue was considered by this Court in the case of Ramesh Prasad Sao [2023 (10) TMI 405 - CALCUTTA HIGH COURT] wherein the assessee company was engaged in iron ore mining and it incurred periphery development expenses for territorial welfare as well as welfare of local people in the area in which mines were operating as per the direction of the local administration and such CSR expenses incurred by the assessee prior to the assessment year 2015-16 were held to be liable as business expenditure as same was wholly and exclusively incurred for the purpose of business.
Thus on facts we are convinced that the expenses were allowable more so, when the respondent assessee is a public sector undertaking and they had carried out a notification and they had implemented the notifications issued by the Government of India. The specific case of the assessee was that they incurred the expenditure for facilitating the business of construction and repair of ships mainly for Indian Navy and they were required to take up certain activity for the benefit of people residing in the said locality. Matter is entirely factual and no substantial question of law arises.
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2024 (4) TMI 749
Acquittal of charge u/s 276CC - respondent has failed to comply with the provisions contained u/s 139(1) and he has submitted the income tax returns after a delay of 28 months - “intention”, “motive” and “knowledge” - “culpable mental state” on the part of the accused - HELD THAT:- Apex Court in the case of Prem Das [1999 (2) TMI 6 - SUPREME COURT] held that for holding an accused guilty u/s 276CC ‘mens rea’ is a necessary ingredient. Hence, in absence of proof of ‘mens rea’ and on the basis of mere presumption u/s 132(4-A), the conviction cannot be sustained.
In the above case, the Hon’ble Apex Court has clearly held that the complainant in order to bring home the guilt of the accused for the offence punishable u/s 276C has to prove the mens rea of the accused for non-payment of tax or attempt to evade the tax. But in the present case, the accused respondent has explained the reasons, in detail, about the delay in filing the income tax returns and depositing the entire tax amount with penalty subsequently. Therefore, the complainant/ appellant has failed to prove that the respondent had mens rea to evade the payment of tax. Accordingly, the Income Tax Department has failed to prove the guilt of the accused respondent beyond all the reasonable doubts.
The trial Judge came to the conclusion that even no notice was given to the respondent prior to filing of the complaint against him. Hence, it was found that the offence u/s 276CC was not found to be proved against the respondent.
It is the settled principle of law that while appreciating the evidence, in an appeal against acquittal, if the appellate Court finds that two views are plausible, then the view favouring the innocence of an accused must be taken into consideration.
This Court does not find any perversity in the findings arrived at by the trial Court in acquitting the accused under the aforesaid offences. Accordingly, the instant Criminal Appeal is dismissed. The judgment of acquittal of the accused respondent, passed by the Court below, is upheld.
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