|
Advanced Search Options
Case Laws
Showing 261 to 280 of 1482 Records
-
2023 (6) TMI 1222
Income taxable in India - Capital gain from Singapore as exempted in India - benefit of Article 13(4) of the Double Taxation Avoidance Agreement (DTAA) between India and Singapore - assessee [tax resident of Singapore] Foreign Institutional Investor (FII) in debt segment with Securities and Exchange Board of India - HELD THAT:- The exemption or reduction of tax to be allowed under the DTAA in India shall only apply to so much of the income as is remitted to or received in Singapore where the laws in force in Singapore provides that the said income is subject to tax by reference to the amount which is remitted or received in Singapore. When under the laws in force in Singapore the income is subject to tax by reference to the full amount thereof, whether or not remitted to or received in Singapore, then in that case Article 24(1) would not apply.
AO while framing the draft assessment order has disallowed the benefit of Article 13(4) of DTAA on capital gain earned in India holding that provisions of Article 24 of DTAA speaks about the restriction of exemption of such capital gain to the extent of repatriation of such income to Singapore. AO has held that the assessee has not produced any evidence to show such required repatriation as mandated by Article 24 of DTAA for entitlement of exempted income. This is an incorrect statement as rightly held by the ITAT.
The assessee placed on record even before the AO a certificate dated 16th April 2012 from Singapore Tax Authorities certifying that the income derived by the assessee from buying and selling of Indian Debt Securities and from Foreign Exchange transactions in India would be considered under Singapore Taxes Law as accruing in or derived from Singapore and such income would be brought to tax in Singapore without reference to the amount remitted or received in Singapore.
Singapore authorities have themselves certified that the capital gain income would be brought to tax in Singapore without reference to the amount remitted or received in Singapore. The AO could not have come to a conclusion otherwise.
As stated in the circular No. 789 dated 13th April 2000, though it applied to Indo-Mauritius Double Tax Avoidance Convention with reference to certificate of residence, the purport and principle is clear. Such certificates issued by the Singapore Tax Authorities will constitute sufficient evidence for accepting the legal position. We see no reason to admit this appeal on this ground. No substantial questions of law arise
-
2023 (6) TMI 1221
Reopening of assessment - absence of jurisdiction with the issuing authority for reopening - as alleged approval as required u/s 151 had not been obtained - four years had expired - scope of provisions of Section 151 came to be amended with effect from 01/04/2021 - HELD THAT:- The impugned notice is liable to be set aside on the ground of absence of jurisdiction with the issuing authority.
As decided in J M Financial and Investment Consultancy Services Private Limited [2022 (4) TMI 1446 - BOMBAY HIGH COURT] since four years had expired from the end of the relevant assessment year, as provided under Section 151(1) of the Act, it is only the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner who could have accorded the approval and not the Additional Commissioner of Income Tax.
As the stand taken by the respondents that by virtue of provisions of the Act of 2020, the approval of Assistant/Joint Commissioner of Income Tax as granted was valid has been turned down. In view of Section 151(1) of the Act of 1961 prior to its amendment it was only the Principal Chief Commissioner or the Chief Commissioner of Income Tax who could have accorded the approval. Thus a case for interference has been made out. Decided in favour of assessee.
-
2023 (6) TMI 1220
Exemption u/s 11 - Receipt of voluntary contributions/corpus fund or capitation fee - AO held that there was violation under the KEI (Prohibition of Capitation Fee) Act, and accordingly, brought the money collected by the assessee to tax - ITAT deleted the additions - HELD THAT:- AO, based on assumption and surmise, has held that there was violation under the KEI (Prohibition of Capitation Fee) Act by the assessee and that incorrect assumption has been rightly reversed by the ITAT.
So far as the authority in New Noble Educational Society is concerned, the Apex Court [2022 (10) TMI 855 - SUPREME COURT] has held that the registration under different statues is also a relevant consideration while deciding the application for approval under Section 10(23C) of the Act.
In the case on hand, we are not dealing with a situation where the IT Department was considering any application for granting exemption. On the other hand, the department had issued the exemption certificate and the AO on an incorrect assumption has treated the money collected by the assessee as capitation fee under the KEI (Prohibition of Capitation Fee) Act. Therefore, the said authority does not lend any support to the Revenue. This court has already taken a view in Kammavari Sangham and the same is applicable to the facts of this case. Decided against revenue.
-
2023 (6) TMI 1219
Penalty u/s 271(1)(c) - Defective notice - cessation/remission of liability u/s 41(1) - HELD THAT:- Penalty proceedings entail civil consequences for the assessee. The AO is required to apply his mind to the material particulars, and indicate clearly, as to what is being put against the respondent/assessee when triggering the penalty proceedings.
In case the AO concludes, that a case is made out under Section 271(1)(c) of the Act, he needs to indicate, clearly, as to which limb of the said provision is attracted. The reason we say so is, that apart from anything else, the pecuniary burden may vary, depending on the infraction(s) committed by the respondent/assessee. In a given case, where concealment has taken place, a heavier burden may be imposed, than in a situation where an assessee is involved in furnishing inaccurate particulars.
Therefore, it is necessary for the AO to indicate, broadly, as to the provision/limb under which penalty proceedings are triggered against the assessee.Clearly, this has not happened in the instant case.
As a matter of fact, even in the assessment order, whereby proceedings were triggered, there is no indication whatsoever, as to which limb of Section 271(1)(c) of the Act was triggered. Decided in favour of assessee.
-
2023 (6) TMI 1218
Territorial jurisdiction of this High Court - HELD THAT:- As since the AO who framed the assessment is located in Gurugram, of the Supreme Court rendered in CIT v. ABC Papers Ltd [2022 (8) TMI 863 - SUPREME COURT] the instant appeals will not lie in the present High Court.
Accordingly, liberty is sought to withdraw the appeals and file the same before the Court which would have territorial jurisdiction in the matter. Leave in that behalf is granted.
The appellant/revenue is given eight weeks to file the appeals. The time to file the appeals will commence from the date of receipt of a copy of the order.
-
2023 (6) TMI 1217
TDS u/s 194H - Discount or Commission - Demand u/s. 201(1) / 201(1A) - credit notes and gold coins offered on annual rebate to selected dealers upon achieving targets - assessee submitted that credit notes were given in order to promote the sales - AO held that such credits were in the nature of commission which would require TDS - HELD THAT:- For applicability of TDS obligation u/s 194H, there should exist agency relationship between the payer and the payee. The payee should act as on agent for the assessee. From the fact, it emerges that the assessee sells its products through network of dealers / distributors under a commercial agreement.
As per the terms, the risk and rewards of sale transaction pass on to these dealers at the point of time of sale only. The assessee merely regulates business terms for the purpose of sale. Nevertheless, the sale happens on principal-to-principal basis only.
Fixed rebates are generally reduced from the invoice and only net sale consideration is shown in the financial statements. Variable rebates are based on sales quantity or on achievement of sales targets - Dealers / distributors do not act on behalf of the assessee rather they act on independent basis subject to business terms laid down by the assessee.
The risk and reward of goods get transferred at the time of sale by assessee to these dealers. The documents as placed on record substantiate all these facts.
The decision in the case of CIT vs. Ahmedabad Stamp Vendors Association [2012 (9) TMI 298 - SC ORDER] supports the case of the assessee as held that discount given to stamp vendors for purchasing stamps in bulk quantity was in the nature of cash discount in transaction of sale and, therefore, section 194H would have no application to that transaction.There was no obligation on assessee to deduct TDS on rebates given on transaction of sale. Accordingly, impugned demand, for both the years, stands deleted. Decided in favour of assessee.
-
2023 (6) TMI 1216
Nature of receipts - non-refundable security deposits received by appellant - nature of security deposits - revenue or capital receipt - As per AO security deposits are not shown as advance receivables at the asset side nor shown as liability towards customers in the balance-sheet of M/s Silver Line Holdings Pvt. Ltd. and that without passing the amount through its account M/s Silver Line Holdings Pvt. Ltd. transferred the same to the assessee, thus has to be considered to be non-refundable - HELD THAT:- In the light of various clauses of Tripartite agreement and the agreement between the assessee and SHL discussed above it is established that both the companies were operating in different fields of the project. The rights in the land vested with SHL along with other subsidiaries and they were transferred in favour of any buyer of Villa/ Units and qua service or amenities of Gold Course, SHL was separately charging non-refundable deposits. It was responsibility of SHL to account for the same in books for which assessee cannot be faulted.
Ld. tax authorities below have completely ignored the corrigendum agreement dated 29.09.2009, considering the same to be self serving ignoring that other clauses of tripartite Buyer’s agreement and agreement between assessee and SHL dated 24.12.2008 were themselves clear of the fact that what assessee was getting was something in the form of refundable deposit .
CIT(Appeals) has rightly concluded non-refundable security deposits received by appellant has nexus with O&M services provided to the clients. However, he failed to appreciate that in the hands of assessee the same were refundable and merely as means to finance O&M services. Thus, the same were not of revenue nature receipts.
Apart from above, there is also force in the contention of learned AR that the Coordinate Bench in assessee’s own case, [2019 (7) TMI 1434 - ITAT DELHI], has considered the nature of deposits in the hands of assessee as refundable security deposits, as one of the possible view as decided in favour of assessee.
-
2023 (6) TMI 1215
Estimation of income - Bogus purchases - communication received from the DDIT(Inv) with regard to the information received from sales-tax department, as per which, the assessee is involved in taking bogus entries towards purchases - CIT(A) given partial relief only to the extent of 50% of the amount reflected in the stock register - HELD THAT:- We notice that there are certain discrepancies in the figures considered by the CIT(A) for the purpose of disallowance and the figures as per assessee's stock register.
CIT(A) did not call for any remand report from the AO with regard to the additional evidences submitted by the assessee and there is per se violation of Rule 46A of the Income-tax Rules, 1962.
The issue should go back to the AO for fresh verification of the evidences submitted by the assessee. Accordingly we remit the issue for a fresh verification to the AO with a direction to consider the reconciliation statement of the stock register prepared by the assessee and also to keep in mind the decision of Mohammed Haji Adam & Co [2019 (2) TMI 1632 - BOMBAY HIGH COURT] as held that profit embedded in the sale of bogus purchases can only be added since the AO in the instant case as noted has not disturbed the sales figures shown by the assessee and decide accordingly. Needless to say that the assessee be given an opportunity of being heard. Appeal is allowed for statistical purpose.
-
2023 (6) TMI 1214
Assessment u/s 153A - belated filing of returns - statutory time limit provided for filing the returns of income in response to notice under section 153A - HELD THAT:- When a search is initiated, the assessee is not required to file his return till such time he receives notice u/s 153A of the Act. Once such notice is received, the liability fastens on the assessee to file the return within the reasonable time specified in the relevant notice.
As the revised return filed by the assessee for the assessment years 2011-12 to 2016-17 are invalid returns and have to be declared non-est, for the reason that these are nothing but revising of belated returns filed on 13.06.2018. Hence, the entire additional incomes offered by the assessee in the revised returns filed on 13.12.2018 for assessment years 2011-12 to 2016-17 cannot be taxed at all in the relevant assessment years as it had been offered in the invalid and non-est revised return.
Addition made towards unsecured loans u/s 68 and consequential disallowance of interest on such loans - Admittedly, there is absolutely no incriminating material found during the course of search for assessment years 2011-12 to 2015-16 in respect of making addition made towards unsecured loans under section 68 of the Act and consequential disallowance of interest on such loans. Hence, the earlier assessment years for assessment years 2011-12 to 2015-16 cannot be disturbed at all by learned AO while framing the search assessments under section 153A of the Act.
This issue is no longer res integra in view of the recent decision of the Hon’ble Supreme Court in case of PCIT Vs. Abhisar Buildwell Pvt. Ltd [2023 (4) TMI 1056 - SUPREME COURT] wherein the decision of Kabul Chawla [2015 (9) TMI 80 - DELHI HIGH COURT] has been upheld by the Hon’ble Apex Court. Hence, in view of the same, all the additions made by learned AO in the search assessments for assessment years 2011- 12 to 2015-16 are hereby directed to be deleted.
In view of our earlier observations made that the revised returns filed by the assessee for the assessment years 2011-12 to 2015-16 on 13.12.2018 are invalid and non-est, the income to be determined for assessment years 2011-12 to 2015-16.
-
2023 (6) TMI 1213
Unexplained cash credits u/s. 68 - share application money received by the assessee - Assessee failed to establish the genuineness and creditworthiness of the investing companies - CIT-A deleted the addition - HELD THAT:- Apart from making bald allegations, the Revenue did not bring any such material on record to substantiate its claim.
As in respect of all the 5 companies the Revenue has conducted scrutiny assessment in the preceding years. A mere isolated transaction by one of the alleged entry operators in one of the investor companies does not taint the entire share transaction in the assessee company in the absence of any corroborative material being brought on record. Further, we find that the funds were received, inter-alia, from the sale of equity shares of some other companies by these investors or from the refund of advances for the purchase of shares.
Thus,we find no merit in the aforesaid submission of the learned DR. Therefore, from the above it is evident that the assessee has also proved the source of source of the investors in the present case to satisfy the test of creditworthiness of the investor and genuineness of the transaction, against which no contrary material has been brought on record. - Decided against revenue.
-
2023 (6) TMI 1212
Exemption u/s. 11 - Charitable activity u/s 2(15) - Assessee trust is an autonomous body which is established under 5/2 of the Gujarat Town Planning and Urban Development Act, 1976 made there under carrying Planned Development of areas as defined and designed by the Government of Gujarat and also infrastructural activities relating thereto such as construction of roads, bridges, drainage system, water connection for the benefit of public at large - HELD THAT:- We hold that the activities of the assessee for advancement of any other object of ‘General Public Utility’ for charitable purpose and therefore the assessee corporation shall be entitled to exemption u/s. 11 of the Act.
Hon’ble Supreme Court in ACIT vs. Ahmedabad Urban Development Authority [2022 (11) TMI 255 - SUPREME COURT] wherein it has been clearly held that the Revenues Appeals are dismissed as far as statutory Corporations/Boards - Decided in favour of assessee.
-
2023 (6) TMI 1211
TP adjustment - ALP of the international transactions relating to merchanting trades - what should be the PLI of the assessee qua the PLI of the comparables? - only variation made by the TPO to the PLI of the assessee is to add the cost of goods to the denominator - HELD THAT:- Admittedly, in the TP study report, the assessee had furnished segmental information regarding both the merchanting trades segment and physical trade segment. TPO has also accepted the segmental analysis of the assessee. In fact, he has accepted the transactions in trading segment to be at ALP.
As discussed earlier, the only variation, he has made in merchanting trades segment, is in relation to PLI of the assessee. Thus, neither the TPO nor DRP have made any adverse comment regarding the merchanting trades segment.
When there is no allegation either by RBI or any other regulatory authority regarding merchanting trades segment of the assessee, in our view, DR cannot give a new dimension to the entire issue by making allegations which are not borne out on record.
DR cannot improve upon the case of the TPO or learned DRP by enlarging the scope of the appeal. Thus, considering the fact that in the PLI of the comparables, cost of goods is not included in the denominator, in our view, the same would also apply to the assessee. Hence, cost of goods cannot form part of the denominator of PLI. Accordingly, we direct the Assessing Officer to compute the ALP by applying PLI of operating profit to value added cost, excluding the cost of goods. Grounds are allowed.
-
2023 (6) TMI 1210
Reopening of assessment - Period of limitation - time limit for passing the assessment order - HELD THAT:- We find that case of assessee for assessment year 2012-13 was reopened under section 147 of the Act. The notice u/s 148 was served upon the assessee on 29.03.2019 as recorded in para-2 of the assessment order. In response to notice u/s 148 of the Act, the assessee filed its return of income on 27.04.2019 and assessment was completed on 21.06.2021. We find that time period for passing the re-assessment was up to 31.12.2019. Thus, the assessment order, is passed beyond the time period prescribed u/s 153(2) - Decided in favour of assessee.
-
2023 (6) TMI 1209
Nature of receipt - one time settlement arising out of waiver of dues of term loan by the lender - Revenue or capital receipt - HELD THAT:- We find the Hon’ble Supreme Court in the case of T.V. Sundaram Iyengar & Sons Ltd[1996 (9) TMI 1 - SUPREME COURT] while holding that if an amount is received in the course of trading transaction, even though it is not taxable in the year of receipt being of revenue character, the amount changes its character when the amount becomes the assessee’s own money because of limitation or by any other statutory or contractual right. When such a thing happens, commonsense demands that the amount should be treated as income of the assessee.
Assessee itself has credited the waiver of the amount to the Profit & Loss A/c and offered only the interest component to tax and did not offer the amount treating the same as capital in nature.
The waiver of the principal amount which was taken for trading purpose and credited to the profit & loss account of the assessee, results in income in the hands of the assessee and therefore, the learned CIT (A) is fully justified in upholding the action of the AO in bringing the same amount to tax in the hands of the assessee. The grounds raised by the assessee are accordingly dismissed.
-
2023 (6) TMI 1208
Addition on account of difference in Gross Profit Rate - method of accounting - AO noticed that the assessee company, in its trading account, is showing gross sales including trade discount as total sales which are, in fact, not being credited into its books of accounts - HELD THAT:- GP rate adopted by the AO for A.Y 2010-11 is not comparable with the GP rate of A.Y 2011-12 and 2012-13 under the consideration because the sales is a predominant determinative factor and the same is not comparable as the assessee has accounted the sale at DLP during the A.Y 2010-11 as against the accounting of turnover at MRP during the year under consideration.
Sale is prime component to determine the GP ratio and if the sale factor is not comparable, resulting GP cannot be considered comparable. On totality of facts, we do not find any reason to interfere with the findings of the ld. CIT(A). The common grounds relating to GP addition in A.Y 2011-12 and 2012-13 are dismissed.
Addition on account of Scheme Expenses - as per AO though the assessee has given details of scheme but not furnished details of beneficiaries to whom these gift items were distributed - whether the expenses have been incurred for the purpose of the business and is not of capital in nature? - HELD THAT:- As there is no dispute that the expenses were incurred for the purpose of business and were not of capital expenditure, the same has to be allowed. But, at the same time, the quantum can be questioned for want of supporting evidences as the same were not justified by production of books of account. Therefore, in the interest of justice and fair play, we deem it fit to restrict the disallowance to 10% of the expenditure claimed under this head. Thus direct the AO to restrict the disallowance.
Addition of overriding commission - justification of claim of expenditure and explain the basis of payment asked - as per AO justification for payment given by the assessee is too general and no specific information has been given justifying payment - CIT-A deleted the addition - HELD THAT:- It is true that in A.Y 2010-11 also, similar disallowance has been made and it is equally true that while making the disallowance for A.Y 2011-12, the AO has simply followed the findings given in A.Y 2010-11. Since in A.Y 2010-11 addition was deleted by the ld. CIT(A) and though the revenue was in appeal before this Tribunal but deletion of this addition was not challenged. Therefore, the same has attained finality. Finding parity of facts, we do not find any error or infirmity in the deletion made by the ld. CIT(A). Deletion stands confirmed.
-
2023 (6) TMI 1207
Adjustment u/s 143(1)(a) - Addition u/s u/s.36(1)(va) - disallowance made for late deposit of employees’ share of PF/ESI contribution to the relevant funds beyond the date prescribed under the respective Acts - HELD THAT:- From the material available on the record, find that the matter is squarely covered by the decision of ‘Emson Tools Mfg. Corp. [2023 (4) TMI 626 - ITAT CHANDIGARH] as CIT(A) was justified in sustaining the adjustment u/s 143(1)(a) by means of disallowance made for late deposit of employees’ share of PF/ESI contribution to the relevant funds beyond the date prescribed under the respective Acts.”
CIT(A) was justified in sustaining the adjustments u/s 143(1)(a) by means of disallowances made for late deposit of employees’ share of PF/ESI contributions to the relevant funds beyond the date prescribed under the respective Acts. Decided in favour of assessee.
-
2023 (6) TMI 1206
Scope of limited scrutiny assessment - Addition made on account of interest income not returned to tax by the assessee - HELD THAT:- As the addition made on account of interest earned from bank by the assessee is set aside as the same is beyond the scope of limited scrutiny assessment. The said action could not have been made in the present limited scrutiny assessment by the AO. The addition is therefore is not sustainable in law, and directed to be deleted, and the ground of the assessee is allowed.
Denial of deduction u/s 80P(2)(a)(i) - income earned from activities of providing bills collection facilities to its members - HELD THAT:- The said clause of section 80P allows deduction only of income earned by cooperative societies from the business of providing banking or credit facilities. Assessee has been unable to demonstrate as to how this income qualifies for deduction under clause (a) of section 80 P(2) of the Act. Therefore agree with the ld.CIT(A) that the assessee is not entitled to deduction of income earned from the activities of providing bills collection services to its members under section 80P(2)(a)(i) of the Act and, the ld.CIT(A) hold has rightly disallowed the same.
Set off expenses incurred for earning of incomes to which the assessee was denied deduction under section 80P(2) at the rate of 5% thereof - contention of assessee was that the estimation ought to have been done on reasonable basis and for such purpose, he requested the matter to be restored back - HELD THAT:-As find merit in the contentions of assessee that there has to be a reasonable basis for arriving at any estimation, and in the absence of any such basis being provided by the ld.CIT(A),restore this issue back to the ld.CIT(A) to estimate the expenses to be allowed against the income from other sources liable to tax on a reasonable basis. Ground of appeal is allowed for statistical purposes.
-
2023 (6) TMI 1205
Assessment u/s 153A - Addition u/s 68 - unexplained cash credit - Burden of proof - HELD THAT:- As assessee has filed all the bank statements and ledger account of creditors, evidencing receipts and refund of unsecured loans. The factual matrix of the case indicates that the assessee has discharged its initial onus to prove the identity, creditworthiness and the genuineness of transaction by filing necessary details as an additional evidences which have been duly accepted by the CIT(A) and necessary remand reports have been called for in accordance with the laid down procedure of law.
No incriminating material was brought on record by the AO during the opportunity provided to him to examine and investigate based on the additional evidences. Admittedly, loans were repaid, during this relevant assessment year itself. The date of receipt of the loan was 06/2013 and the date of repayment was 03/2014 which is much before the date of search i.e. 13.09.2015. Due interest has been paid and tax on payment of interest was also deducted as per law. Thus, it can be held that the requirement of law like identity, credit capacity and genuineness of transaction is satisfied by the assessee. Hence, the addition made by the Assessing Officer is deleted and the ground of appeal of the Revenue is dismissed.
-
2023 (6) TMI 1204
Depreciation disallowance - non use of asset - production and business activity of the assessee company was stopped since the year 2003 - HELD THAT:- In the present case of assessee, the production and business activity was stopped since the year 2003 and profit & loss account of the assessee company had revealed that the total revenue earned by the assessee in previous year mainly comprised of revenue from operation and other income which included interest income and miscellaneous income and the assessee company had no business and manufacturing activity from which revenue could be earned and machinery was not put to use as there was admittedly no manufacturing activity.
In such a situation, depreciation could not be allowed on such non-use in view of the clear verdict given in Oriental Coal Co. Ltd. [1994 (1) TMI 82 - CALCUTTA HIGH COURT] and which is directly on the present issue involved as held that as there was strike, lockout in the factory for two years and the plant and machinery has not been actually used, then assessee would not be entitled for depreciation - Decided against assessee.
-
2023 (6) TMI 1203
Offence punishable u/s 276B r/w section 278B - Criminal liability of Directors of the Company - Failure to deposit TDS within prescribed time - Person in charge of the business of the firm when the offence was committed - HELD THAT:- As complaint does not disclose the necessary particulars as to how and in what manner the present applicants /original accused No. 2 to 4 were in-charge of and responsible to the accused No. 1 company for the conduct of day to day business of the company including the deduction of TDS and depositing the same to the credit the Central Government, so as to initiate criminal prosecution for the commission of offence under section 276B r/w section 278B of the Income Tax Act.
Hence, the impugned order which does not disclose the application of mind while issuing process against the applicants /original accused No. 2 to 4, cannot be said to be legal, correct and proper so as to sustain it. Ultimately, I would agree with the submissions advanced by Advocate Poonam Ankleshwaria appearing for the present applicants /original accused No. 2 to 4 to quash and set aside the impugned order.
............
|
9911796707
