ITAT Cases Weekly Round-Up: 17 To 23 March 2024
Mariya Paliwala
24 March 2024 11:00 AM GMT
Deeming Provisions Of Sec 69B Can't Be Invoked Once Nexus Of Source Of Unrecorded Transactions With Assessee's Business Is Proved: Chandigarh ITAT Case Title: M/s A.P Knit Fab verses DCIT Finding that the difference in stock found out by I-T Authorities has no independent identity and is part & parcel of entire stock, the Chandigarh ITAT refused to treat such difference...
Deeming Provisions Of Sec 69B Can't Be Invoked Once Nexus Of Source Of Unrecorded Transactions With Assessee's Business Is Proved: Chandigarh ITAT
Case Title: M/s A.P Knit Fab verses DCIT
Finding that the difference in stock found out by I-T Authorities has no independent identity and is part & parcel of entire stock, the Chandigarh ITAT refused to treat such difference as undeclared business income and clarified that it cannot be said that there is an undisclosed asset which existed independently.
Proceeding Upon Intimation Passed U/s 143(1) Without Granting Reasonable Opportunity Of Hearing To Assessee, Is Bad In Law: Kolkata ITAT
Case Title: Aashirvad Villa Limited verses ITO
The Kolkata ITAT held the intimation passed by the Assessing Officer under section 143(1) and proceeding on such intimation to be bad in law, as the same was passed without granting any reasonable opportunity of hearing to the assessee.
Belief Of AO Regarding Escapement Of Income Should Be Based On Some Tangible Information: Kolkata ITAT Quashes Reassessment
Case Title: ACIT verses M/s Ace Trexim Pvt Ltd
The Kolkata ITAT recently clarified that mere information regarding transfer of funds is no basis to conduct reassessment once the source of such transfer was sufficiently established through the banking channel.
Accepting Submissions Of Assessee Cannot Be Said As Faulty If Assessment Was Made By National E-Assessment Centre: Indore ITAT Quashes Sec 263 Order
Case Title: AL A S Real Estate and Developers Private Ltd Verses Pr. CIT
While holding the revision-order passed by PCIT as invalid, the Indore ITAT recently clarified that I-T authorities cannot punish the assessee by merely saying that the payee has not filed income-tax return.
Rights Held By Taxpayer As Confirming Party In Sale Deed Is Capital Asset As Per Sec 2(14) And Liable For LTCG: Ahmedabad ITAT
Case Title: DCIT verses Shri Bharatkumar Babubhai Patel
On finding no infirmity in the order passed by the CIT(A), the Ahmedabad ITAT confirmed that rights held by the assessee as a Confirming Party in the Sale Deed is a capital asset within the meaning of Section 2(14) and liable for LTCG and the assessee is also eligible to claim deduction u/s. 54B of the Income Tax Act, 1961.
Failure To Produce Share Certificate Is No Basis To Doubt Share Purchase Transaction: Mumbai ITAT Refers Art 265 Of Constitution
Case Title: Shantaben Fathechand Mehta verses Income-tax Officer
Referring to Article 265 of the Constitution of India, the Mumbai ITAT remanded the case to the file of AO with direction to verify factual aspects, pertaining to the purchase of the shares in consideration and re-compute the liability accordingly.
Trading Income From Sale Of Scrips Can't Be Conferred As 'Unaccounted Income' If Trading Activity Is Not Disputed At Any Time: Ahmedabad ITAT
Case Title: Shripal Sheshmal Jain HUF verses Income Tax Officer
On finding that AO as well as the CIT(A) was not right in making/confirming the addition on account of unaccounted business income, the Ahmedabad ITAT deleted the addition made by AO under the Income Tax Act, 1961.
If Period Of Holding Of Plant & Machinery Is More Than 36 Months, it Qualifies As Long-Term Capital Asset As Per Sec 2(42A): Ahmedabad ITAT
Case Title: DCIT verses M/s Claris Lifesciences Limited
The Ahmedabad ITAT ruled that when the period of holding of the plant and machinery is more than 36 months, then the same has to be treated as long-term capital asset in pursuant to the provisions of section 2(42A) of the Income tax Act.
Deeming Provisions Of Sec 2(22)(E) Gets Attracted To Beneficial Shareholder Only Who Has Controlling Interest: Kolkata ITAT
Case Title: Apeejay Surrendra Management Services Pvt Ltd. verses DCIT
Since the income accrues or arises or is deemed to accrue or arise in the hands of KSWPL and not in the hands of the assessee, the Kolkata ITAT held that by invoking second limb of section 2(22)(e) of the Income tax Act, accrual of income and its taxability cannot be held to be in the hands of the assessee.
Ahmedabad ITAT Quashes Sec 263 Order Absent Twin Conditions For Exercise Of Power Under Said Provision
Case Title: Soham Buildcon verses PCIT
On finding that there is no prejudice against the Revenue and the twin conditions to exercise the power u/s 263 of the Income Tax Act, 1961 have not been satisfied, the Ahmedabad ITAT set aside the order of PCIT to assess the assessee's case freshly.
AO Can't Apply Sec 69 R/w/S 115BBE To Surrendered Business Income Of Assessee Which Was Duly Offered In I-T Return: Chandigarh ITAT
Case Title: Aniljit Singh Arora verses DCIT
Finding that the nature and source of unaccounted investment in the hospital building is arising out of assessee's professional receipts, the Chandigarh ITAT ruled that there was no justifiable basis on the part of the AO in applying the provisions of Section 69 r/w Section 115BBE of the Income tax Act to the surrendered business income of the assessee which has been duly offered in the return of income.
Kolkata ITAT Deletes Addition Made By AO Upon Capital Gains By Adopting Value Of Property As Per DVO's Report
Case Title: Sri Arijit Chakraborty verses ITO
Upon not finding justification on the part of the Income Tax Authorities in computing the capital gains by adopting the sale value as per the value estimated by the Departmental Valuation Officer, theKolkata ITAT deleted the addition made by the AO in respect of capital gains by adopting the value of the property as per the DVO report.
Mere Dismissal Of Appeal For Want Of Prosecution Is Not In Accordance With Mandate Of Sec 250(6): Kolkata ITAT
Case Title: Aryavrat Vintrade Pvt Ltd verses ITO
Since the AO as well as the CIT(A) has not examined the issue with the angle of section 69, rather they took the conditions of section 68 where unexplained cash credit is required to be explained by the assessee and applied on the issue of investment, the Kolkata ITAT remanded the matter for re-adjudication.
Prima Facie Adjustment Made By CPC Towards Deduction U/s 80P Prior To Apr 01, 2021 Is Beyond Its Jurisdiction: Kolkata ITAT
Case Title: Bisharpara Kodalia Cooperative Credit Society Ltd. verses ITO
The Kolkata ITAT ruled that section 80AC of the Income tax Act puts a bar against claiming of deduction in respect of certain income provided under the head (C) of Chapter VIA which includes section 80P of the Act also if the return of income are not filed before the due date prescribed u/s. 139(1) of the Act.
Rule 11UA(2)(A) R/w Explanation (A) To Sec 56(2)(Viib) Does Not Require Valuation Report For Substantiation Under NAV Method: Delhi ITAT
Case Title: DCIT verses Continental Corrugators Pvt. Ltd.
Finding that the book value of assets and liabilities adopted for the purposes of NAV method of valuation is in consonance with last audited balance-sheet items, the Delhi ITAT clarified that the AO has misdirected himself on seeking valuation report which requirement do not emanate from the law codified in this regard.
Taxpayer Possessing Tax Residency Certificate & Offering Taxes On Income In Other Contracting State, Deserves Treaty Benefit U/s 90: Kolkata ITAT
Case Title: Debarghya Chattopadhaya verses DCIT
Finding that the Appellant/ Assessee has valid Tax Residency Certificate (TRC) for United Kingdom, the Kolkata ITAT reiterated that the salary income received by assessee for his work during stay at United Kingdom is exempt from tax on account of treaty benefit.
AO Fails To Demonstrate Live Link Between Tangible Material & Reason To Believe Escaped Income: Delhi ITAT Quashes Reopening
Case Title: ITO verses Surender Dalal
On finding that the requirement of application of mind is missing in the instant case, the Delhi ITATheld that the reassessment made in the section 143(3) read with section 147 of the Income Tax Act, 1961, is bad in law and hence, the re-assessment order is quashed.
CIT(A) Can't Simply Dismiss Any Appeal U/s 250 On Account Of Non-Prosecution, Without Discussing Merits Of Case: Ahmedabad ITAT
Case Title: Babubhai Ramanbhai Patel verses Deputy CIT
The Ahmedabad ITAT emphasized that as per Section 250 of the Income tax Act, it is incumbent on the CIT(A) to make necessary enquiry before passing the order and he is obliged to decide each of the points arising out of the appeal i.e. grounds on merits have to be discussed even in an ex-parte order.
Addition Towards Purchases Should Be Restricted To Embedded Profit Once AO Has Not Disputed Sales Declared By Assessee: Mumbai ITAT
Case Title: M/s B Narayan Associates verses CIT
Referring to the decision of Bombay High Court in the case of Principal CIT vs Mohammed Haji Adam & Co (Income Tax Appeal No.1004 of 2016 dated 11/02/2019), the Mumbai ITAT reiterated that the additions should be limited to the extent of the G.P. rate on purchases at the same rate of other genuine purchases.
Premium Charged On Issue Of Shares To Existing Shareholder Is Not Deemed Income U/s 56(2)(Viib) If No Income Accrues To Ultimate Beneficiary: Delhi ITAT
Case Title: ACIT verses Dhruv Milkose Pvt. Ltd.
Recently, the Delhi ITAT reiterated that object of deeming an unjustified premium charged on issue of share as taxable income u/s 56(2)(viib) of the Income tax Act is wholly inapplicable for transactions between holding and its subsidiary company where no income can be said to accrue to the ultimate beneficiary, i.e., holding company.
Claim Seeking Application Of Income For Charitable Purpose U/s 11 & 12 Can't Be Denied To Trust On Mere Technicalities: Delhi ITAT
Case Title: Asha Modern Educational Society vs ITO
The New Delhi ITAT emphasized that the Revenue Authorities have to tax the right person in right manner and shall not disallow the eligible deductions on mere technicalities.
Income Tax Exemptions Available To ST Individuals Can't Be Extended To Partnership Firm: ITAT
Case Title: M/s Hotel Centre Point, Shillong Versus ITO
The Guwahati Bench of the Income Tax Appellate Tribunal (ITAT) has held that the exemption under Section 10(26) of the Income Tax Act has been specifically conferred on members of the Scheduled Tribe residing in the specified area. The exemption cannot be extended to another separate and distinct "person," that is, the partnership firm, though such a firm consists of the individual partners who, in their individual capacities, are entitled to such an exemption.
LTCG Tax Exemption Can't Be Denied Due To An Error Made By The Builder In Assigning Apartment: ITAT
Case Title: Mukesh Harilal Mehta Versus Income Tax Officer
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that tax benefits cannot be denied to taxpayers due to an error made by the builder in assigning the apartment.
