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Case Laws
Showing 161 to 180 of 1465 Records
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2016 (3) TMI 1313 - DELHI HIGH COURT
Deduction u/s 10B - Learned counsel for the parties are permitted to file additional documents/papers which are part of the assessment record or were filed before the ITAT within eight weeks.
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2016 (3) TMI 1312 - ITAT DELHI
Validity of reassessment order - failure to comply with the mandatory conditions of section 147 to 151 - the agricultural land sold by the assessee and profit earned thereof which has been claimed commission - AO passed order u/s 143(3) of the read with Rule 147 taxing 50% of the capital gain on sold as this land as short-term capital gain. - Held that:- The reason recorded does not show any material based on which the reopening has been initiated. Further the reasons recorded for reopening as well as the inspector report are not in conformity with each other as the reopening has been made under the assumption with the land in question is falling within the specified number of kilometers, whereas the inspector’s report shows that the main land is about 11 kms from the Palwal-Tehsil.
In view of the above facts we are of the view that the case of the assessee squarely falls within the parameters laid down by Hon’ble Delhi High Court - the notice issued u/s 148 read with section 147 is invalid - Decided in favor of assessee.
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2016 (3) TMI 1311 - ITAT VISAKHAPATNAM
Additions u/s 40a(ia) - TDS liability on finance charges and interest in the form of equated monthly instalments to the finance companies from whom the loans were obtained - it was submitted that the finance companies have taken post dated cheques by way of monthly instalments of the entire loan amount and hence it is not possible for the assessee to separately deduct tax. - Held that:- the provisions of section 40(a)(ia) of the Act cannot be applicable in respect of amounts already paid before 31st March and allowed the appeal filed by the assessee. - Decided in favor of assessee.
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2016 (3) TMI 1310 - MADRAS HIGH COURT
Grant of exemption in terms of Sec.10(23C)(vi) denied - Held that:- As per Section 2(15) of the Act ‘Charitable purpose’ means ‘charitable purpose includes relief of the poor, education, medical relief, [preservation of environment (including watersheds, forests and wild life) and preservation of monuments or places or objects of artistic or historic interest] and the advancement of any other object of general public utility’. Clause-4 of the objectives shall not come within the meaning of charitable purpose as defined under Section 2(15) of the Act. Therefore, the finding of the respondent that the 4th objective cannot be considered as being related to promotion of education as contained in Section 10(23C)(vi) of the Act is just and proper.
Development of Society as narrated in the said objective and hence, for the assessment year 2014-15, the petitioner had multiple objectives and therefore, did not exist solely for educational purpose. As already stated, the amendment made in the Memorandum and Articles of Association can only be prospective and in that case, it shall apply only for the assessment year 2015-16 and cannot be considered for the assessment year 2014-15. Considering all these aspects, the respondent had rightly rejected the Form-56 D filed by the petitioner finding that the assessee does not qualify under Section 10(23C)(vi) of the Act for the assessment year 2014-15. Since the facts and circumstances of the case relied upon by the learned counsel for the petitioner differs, the same is not applicable to the present case. Writ petition dismmissed.
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2016 (3) TMI 1309 - MADRAS HIGH COURT
Entitled to deduction under Section 80IA - ‘initial assessment year’ - Held that:- It is hereby clarified that once such initial assessment year has been opted for by the assessee, he shall be entitled to claim deduction u/s 80IA for ten consecutive years beginning from the year in respect of which he has exercised such option subject to the fulfillment of conditions prescribed in the section. Hence, the term ‘initial assessment year’ would mean the first year opted for by the assessee for claiming deduction u/s 80IA. However, the total number of years for claiming deduction should not transgress the prescribed slab of fifteen or twenty years, as the case may be and the period of claim should be availed in continuity.
The Assessing Officers are, therefore, directed to allow deduction u/s 80IA in accordance with this clarification and after being satisfied that all the prescribed conditions applicable in a particular case are duly satisfied. Pending litigation on allowability of deduction u/s 80 IA shall also not be pursued to the extent it relates to interpreting ‘initial assessment year’ as mentioned in Sub- Section (5) of that section for which the Standing Counsel/DRs be suitably instructed.
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2016 (3) TMI 1308 - ITAT PUNE
TDS u/s 195 - disallowance u/s. 40(a)(ia) - commission paid to non-resident agent for his services rendered outside India - Held that:- In the present case, there is no dispute that the payment of commission by assessee is not in the nature of fee for technical service. The commission was paid to foreign agent for procuring order.
Thus, in view all we hold that the assessee was not liable to deduct tax on the commission paid to non-resident agent for his services rendered outside India. Accordingly, no disallowance u/s. 40(a)(i) could have been made in the case of the assessee. - Decided in favour of assessee
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2016 (3) TMI 1307 - MADHYA PRADESH HIGH COURT
CENVAT/MODVAT Credit - duty paying documents - credit availed on the basis of fake documents without actual receipt of goods - right of cross-examination denied - Held that:- The right of the petitioners being effected regarding cross-examination, the order of the Assessing Officer (Annexure P/5) was quashed by the Commissioner of Customs and Central Excise and upheld by the Income Tax Tribunal - the petition is premature and cannot be allowed as a means of stifle the proceedings pending before the Criminal Court - petition dismissed.
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2016 (3) TMI 1306 - ITAT LUCKNOW
Addition on account of milling gain - assessee did not appear despite having knowledge of the date of hearing - Held that:- We have carefully examined the order of the ld. CIT(A) with regard to the grounds raised by the assessee and we find that the ld. CIT(A) has adjudicated the issues involved in the impugned grounds in detail in the light of assessee’s contentions. Since no infirmity is noticed in the order of the ld. CIT(A), we confirm the order of the ld. CIT(A). - decided against the assessee.
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2016 (3) TMI 1305 - ITAT HYDERABAD
TPA - Non consideration of the Cost Accountants allocation of costs between AE and NON AE segments - TPO did not accept the same observing that the same was not audited - Held that:- The cost allocation between AE and Non AE segments by the Cost Accountant has been audited and the same has also been reported by the statutory auditor. The segmental details furnished by the assessee are reproduced at para 4.10 of the DRP’s order. A perusal of the same shows that a sum of ₹ 1069.80 lakhs has been shown as unallocated costs. According to the assessee, this pertains to the unutilized capacity. The assessee has specifically stated so before the DRP. But DRP proceeded to allocate the unallocated expenditure between the AE and Non AE without specifically dealing with the contention of the assessee. Correct allocation of expenditure amongst various segments of the assessee’s transactions has to be done to arrive at the correct PLI.
In the case before us, the revenue is seeking to interfere with the cost accountants report as the adjustment towards under utilization of the capacity has not been allowed both by the TPO as well as the DRP. Therefore, this issue would depend on the decision taken on whether the adjustment for under utilization of the capacity is allowable or not.
Denial of Capacity Utilization adjustment and depreciation adjustment respectively - TPO and the DRP have disallowed these adjustments on the ground that the assessee was a contract manufacturer and therefore the prices at which the goods were supplied to AE cannot go below the agreed price as stipulated in the agreement with its AE - Held that:- the adjustments of under utilization of the capacity and the difference in the depreciation are the factors which are likely to materially affect the price or cost charged or paid, or the profit arising from, such transactions in the open market. Therefore, we direct the AO/TPO to allow the adjustments on account of under-utilisation of capacity and also difference in depreciation method adopted by the assessee and the comparable companies. Since we have held that the adjustment for the under utilization of capacity is allowed, the issue of apportionment of unallocated expenses also needs to be allowed. How much of the un allocated costs do really pertain to under utilization and nature of such costs unallocated were not examined either by the TPO or the DRP and neither are the details filed before us. Consequently, TPO has to examine and consider to what extent the claim can be allowed. The AO/TPO are accordingly directed to re-compute the ALP after allowing the above adjustments after due verification.
Disallowance of loss on account of the directions passed by the DRP - Held that:- we find that Article 265 of the Constitution of India allows the Revenue to levy taxes but only in accordance with law. If during the course of assessment proceedings, it is found that the assessee is eligible for deduction in excess of the sum claimed by it in the return of income, it does not amount to a fresh claim. In our opinion, the Assessing Officer has erred in holding it to be a fresh claim. Therefore we direct the AO to verify and allow the claim of the assessee in accordance with law. Ground No.3 is accordingly set aside to the file of the Assessing Officer and treated as allowed for statistical purposes.
Short deduction of TDS - Held that:- We remand this issue also to the file of the Assessing Officer with a direction to verify the claim of the assessee on this aspect and allow the same in accordance with law.
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2016 (3) TMI 1304 - ITAT NAGPUR
Addition made u/s 40A(3) on account of cash payment towards purchase of land - Held that:- where a Developer had made payments to farmers in cash at the time of purchase of land through a registered sale deed executed before Sub Registrar, the component of cash payment was held as admissible and the invocation of the provisions of section 40A(3) was found to be unjust - reliance is placed on ITAT, Raipur Bench in the case of ACIT vs. R.P. Real Estate Pvt. Ltd. [2015 (7) TMI 1283 - ITAT RAIPUR] - thus it was unjust to invoke the provisions of section 40A(3) - we hereby reverse the findings of the authorities below and direct to delete the addition - Decided in favor of assessee.
Whether the expenditure incurred by the assessee for development of land is to be included for the purpose of valuation of closing stock of land - Held that:- method adopted by the assessee was average purchase price - assessee has furnished the calculation of the valuation stock and before the AO he has admitted that at best a difference in stock of ₹ 2,31,360/- could be assessed. This offer of the assessee has duly been recorded in the assessment order - we therefore, hold that after considering the submissions as well as the method of valuation, at best, a sum of ₹ 2,31,360/- could be upheld by CIT(A), instead of granting the total relief - thus AO is directed to compute the addition accordingly - allowed for statistical purposes.
Disallowance made u/s 40A(3) - Held that:- the expenditure was towards purchase of uniform and payment to staff. Each payment was described by the assessee - CIT(A) has examined the expenditure incurred and thereupon arrived at a conclusion that the payments although were in cash but petty in nature - On that basis he has held that the provisions of section 40A(3) were wrongly invoked - Decided in favor of assessee.
Disallowance of expenditure incurred by partners - Held that:- the expenses was incurred for the purpose of travel, pooja expenses, office expenses etc. CIT(A) has held that considering the nature of the business as well as the scale of the business, the expenditure in question was related to the business activities of the assessee - thus CIT(A) has rightly granted relief after considering the nature of expenditure - Decided in favor of assessee.
Disallowance of expenditure - Travelling for marketing - Held that:- CIT(A) has allowed the claim by assigning the reason that in real estate business travelling is required. However, the said reasoning is general in nature as against that the AO had made specific observation that some of the expenditure were connected with the business but personal in nature - thus we hereby uphold the addition to the extent of ₹ 25,000/- and for rest of the amount the relief granted by learned CIT(A).
Disallowance u/s 40a(2)(b) - Held that:- the first onus is on the AO to place on record his satisfaction that the expenditure was in excess of the fair market value. In this case no such attempt had been made by the AO - assessee’s explanation was that the payment of commission was an ascertained liability of the assessee, hence in the interest of business the commission was paid even if the post dated cheques have been received from the customers at the time of booking of the plot - hence the decision of payment of commission appears to be a business decision of the assessee. Moreover, the AO was not justified to invoke the provisions of section 40A(2)(b) in the absence of any evidence to compare the fair market value - Decided against the revenue.
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2016 (3) TMI 1303 - CHHATTISGARH HIGH COURT
Disallowance u/s 40A(3) for payments made in cash exceeding 20,000/- - payment in cash was out of business compulsion and not optional - Held that:- Cash payments above 20,000/- rupees could be accepted if the conditions prescribed in the Rule 6DD(g) were fulfilled to the satisfaction of the authority concerned. The reasoning of the Tribunal and the interpretation by it of Section 40A(3) and Rule 6DD(g) supported by judicial precedents have not been assailed in this appeal and no submission has been made before us with regard to the same - appeal raises no substantial question of law for determination u/s 260A - Hence the appeal is dismissed.
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2016 (3) TMI 1302 - ITAT DELHI
Power conferred upon the Tribunal under Section 254(1) to grant interim stay - Held that:- Omnibus power conferred upon the Tribunal under Section 254(1) “to pass such orders as it thinks fit” while deciding an Appeal is reinforced in respect of passing interim orders of stay in the first part of second proviso to sub-section (2A). This ancillary power of the Tribunal to “pass an order of stay in any proceedings related to an appeal filed under sub-section (1) of Section 253,”is subject to the twin requirement that the stay order could be passed for a period not exceeding 180 days and that the Tribunal should dispose of the appeal within that period. In the present case we are only concerned with the power of the Tribunal to grant interim stay as conferred by first part of the second proviso to subsection 2 (A) of section 254 of the Income Tax Act.
The appeal of the assessee is pending before the ITAT and has been listed for hearing along with the stay petition and in fact the hearing has also commenced. There is also no doubt that the issues arising in the stay petition flow directly and substantially from the impugned order before the ITAT and the proceedings sought to be stayed relate to the present appeal filed under sub-section (1) of Section 253. During the course of hearing the Stay Petition which stood reinforced on hearing of the Appeal, we found that the assessee had a prima-facie case for grant of stay as prayed for and an order of status-quo was pronounced on the Bench
As the assessee has made out a prima-facie case for grant of stay, the departmental objection that the ITAT does not have the power to grant stay is misplaced. See case of CIT, Central-II vs ITAT [2012 (8) TMI 166 - DELHI HIGH COURT]
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2016 (3) TMI 1301 - ITAT KOLKATA
Addition u/s 40A - truck loading wages charges paid in cash in excess of ₹ 20,000/- - Held that:- The nature of the business of the assessee is such that assessee has no other alternative except to make payment to labours in cash because that area is not served by any bank and the labours do not receipt the payments by cheque or any other mode except in cash.
The assessee’s payments are genuine and not doubted by revenue. The revenue could not controvert that the assessee’s mine is in tribal area of Orissa where no banking facility is available and labourers do not have any bank account to whom assessee has made payment. Accordingly, in the given facts and circumstances of the case, we delete the disallowance made by AO and confirmed by CIT(A) by invoking the provisions of section 40A(3) of the Act - Decided in favour of assessee
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2016 (3) TMI 1300 - ITAT BANGALORE
Calculating deduction u/s. 10A - Held that:- It is admitted that on a parity of comparison, whatever is reduced from the export turnover has to be reduced from the total turnover and this principle was accepted by the jurisdictional Karnataka High Court in the case of CIT Vs. Tata Elxsi Ltd. [2011 (8) TMI 782 - KARNATAKA HIGH COURT] which the Ld CIT(A) has followed. We do not see any reason to interfere with the above.
Comparable selection - TPA - functional dissimilarity - Held that:- Assessee is into Software Devolopement Services thus companies functionally dissimilar with that of assessee need to be deselected from final list.
Treating the expenditure on software licenses as ‘capital in nature’ and not giving credit of TDS by the AO - Held that:- Since the issue is covered in favour of assessee in earlier years, the claim of assessee as revenue expenditure is acceptable. However, as seen from the order of Ld.CIT(A), even after noticing the judgment of jurisdictional High Court he did not grant the benefit in the absence of details. Before us, Learned Counsel submitted that most of the expenditure is on microsoft licenses which are renewable on an yearly basis. This aspect require examination by AO. Consequently, while accepting the principle that software licenses are revenue in nature, examination of expenditure claim is restored to the file of AO. AO after due verification should allow the expenditure accordingly
For claim of tds credit pursuant to decision in COURT ON ITS OWN MOTION VERSUS COMMISSIONER OF INCOME TAX AND OTHERS & ALL INDIA FEDERATION OF TAX PRACTITIONERS VERSUS UNION OF INDIA AND OTHERS [2013 (3) TMI 316 - DELHI HIGH COURT] CDBT issued Instruction No. 5 of 2013, dated July 8, 2013, directing that where assessee approaches AO with requisite details and particulars in the form of TDS certificate as an evidence against any mismatch amount, AO sould verify whether or not the deductor had made TDS payment in the government account and, in the event, the payment had been made, credit of the same would be given to assessee. It is therefore prayed that the AO be directed to verify and allow the entire claim of TDS amounting to ₹ 2,61,44,238/- as claimed by the company in its return of income. Since the issue is one of verification, we direct the AO to undertake the exercising of verification and allow credit.
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2016 (3) TMI 1299 - ITAT RAJKOT
Penalty u/s.271CA - default u/s.206C - additions made u/s.206C(1) on account of non collection of TCS on sale of scrap - Held that:- CIT(A) after relying upon the decision of M/s. Bharti Auto Products [2013 (9) TMI 274 - ITAT RAJKOT] has held that the late submission of Form No.27C and 27BA does not make assessee in default. Since the assessee has not been treated as assessee in default u/s.206C(6) and 206C(7), the question of penalty does not arise. Before us, Revenue has not brought on record any contrary binding decision in its support. - Decided against revenue.
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2016 (3) TMI 1298 - ITAT CHENNAI
Initiation of penalty u/s 271E & 271D - busniss urgency in repayment of loans in cash - Mode of undertaking transactions - Held that:- Assessee has no reasonable cause for accepting loans in cash and repaid the same in cash - cash transactions have not been recorded in the regular books of accounts of the assessee - thus assessee was unable to specify under what circumstances he has borrowed loans in cash and repaid in cash exceeding 20,000/- - thus penalty u/s 271E & 271D is correctly imposed - Decided against the assessee.
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2016 (3) TMI 1297 - ITAT MUMBAI
Carry forward of unabsorbed depreciation - Held that:- Unabsorbed depreciation of AY.1997-98 could be allowed to be carry forward and set off after a period of 8 years in view of the amended section 32(2) of the Act. Respectfully following case of General Motors (I) Pvt.Ltd. [2012 (8) TMI 714 - GUJARAT HIGH COURT] we uphold the order of the FAA in allowing carry forward - Decided in favour of assessee.
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2016 (3) TMI 1296 - ITAT HYDERABAD
Claim for exemption u/s 80P(2)(i)(a) - interest earned - Held that:- As relying on Mahaveer Co-op. Union Bank Ltd [2013 (10) TMI 463 - ITAT HYDERABAD] section 80P(2)(a) is given a restrictive meaning as including the interest earned only on the statutory deposits made by a co-operative society, it would amount to supplying a casus omissus and has to be avoided by the court - Investment of funds by banks including the non-reserves is part of banking activities since no bank: would like its reserve funds to remain idle and not earn any interest. Therefore, the interest earned on such deposits is directly attributable to the business of banking and, therefore, exempt under section 80P(2)(a)(i) – Decided against the Revenue.
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2016 (3) TMI 1295 - CESTAT NEW DELHI
Clandestine removal - absence of tangible evidence to prove that goods removed clandestinely - Held that: - Since the Commissioner (Appeals) has recorded the specific findings that clandestine removal of excisable goods has not been proved by the Department with any tangible evidence and allowed the appeal in favour of the respondent, I do not find it appropriate to interfere with the said findings in the impugned order - appeal dismissed - decided against Revenue.
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2016 (3) TMI 1294 - ITAT NEW DELHI
Penalty u/s 271(1)(c) - depreciation claim on income from house property - Held that:- Admittedly, when the assessee was confronted with the depreciation being claimed on the property, the income from which had been returned under the head income from house property, it immediately realized its mistake of computation of total income and agreed for the addition to its total income.
The mistake was inadvertent, is evident from the fact that assessee had furnished return of income of ₹ 3,27,79,273/- and, therefore, there was no reason to make a false claim of a petty sum of ₹ 7,87,734/-.
The property was appearing in the fixed assets schedule along with other properties, therefore, for all practical purposes, it was treated as a business asset and the depreciation was, accordingly, claimed in the books of account. This aspect is not disputed. It was only at the time of computation of income that the assessee should have made the addition to the profits as per P&L A/c because the income from this property was returned under the head income from house property. Under such circumstances it cannot be disputed that human error could have crept into while making the computation. Thus, it is evident that assessee did not misrepresent the facts at any stage of proceeding. - Decided in favour of assessee.
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