Tax
Direct Tax Cases Monthly Round Up: April 2024
Delhi High Court Income Tax Addition Made Towards Unsubstantiated Share Capital Is Eligible For Section 80-IC Deduction: Delhi High Court Case Title: Valley Iron & Steel Co.Ltd Versus PCIT The Delhi High Court has held that income tax additions made towards unsubstantiated share capital are eligible for deduction under Section 80-IC of the Income Tax Act. Delhi...
Cenvat Credit Rules, 2004 And Central Excise Act, 1944 Lack Provision To Allow Cash Refund Of Cess Lying In Cenvat Credit Balance: CESTAT
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that Cenvat Credit Rules, 2004 and Central Excise Act, 1944 lacks provision to allow cash refund of cesses lying in cenvat credit balance.The bench of Rachna Gupta (Judicial Member) and P.V. Subba Rao (Technical Member) has observed that there is no error when Commissioner (Appeals) has held that there is...
No Service Tax Payable On Consideration Received For Operating And Arranging Outbound Tours: CESTAT
The Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that no service tax is payable on a tour operator's services provided beyond the territorial limits of India.The bench of Rachna Gupta (Judicial Member) and Hemambika R. Priya (Technical Member) has observed that, as per Section 65(105)(n) of the Finance Act and in view of the statutory definition of...
Hyderabad ITAT Grants Additional Opportunity To Taxpayer To Adduce Nature & Source Of Cash Deposits Made During Demonetization
Finding merits in the argument of assessee regarding substantiation of cash deposit during demonetization, the Hyderabad ITAT directed the AO to give one final opportunity to the assessee to substantiate with evidence to his satisfaction regarding the nature and source of the cash deposit of Rs.9,79,000/- during the demonetization period. The Bench of R.K. Panda (Vice-President)...
Mumbai ITAT Confirms Gross Profit Margin @ 12.5% On Alleged Bogus Purchase Since Sales Are Not Disputed: Mumbai ITAT
Finding that the Settlement Commission has not discarded the evidentiary value of the statement of witness (Rajesh Doshi) who has admitted to the modus operandi of availing bogus purchase bill from the assessee, the Mumbai ITAT confirmed the addition made by I-T Authorities on the gross profit margin @ 12.5% on the alleged bogus purchase by assessee. The Bench of...
Merely Making Entries In Books Is Not Sufficient To Discharge Initial Burden Of Proof Regarding Claim Of Cost Of Improvement Of Asset: Chandigarh ITAT
Finding that except for filing copies of so-called invoices of the contractor through whom the work was done, which were also deficient in several respects, no other evidence was filed by the assessee, the Chandigarh ITAT held that the assessee had failed to discharge the initial burden of proof rested on him to substantiate his claim of having incurred expenditure on improvement of...
CIT(A) Shall Not Delete Disallowance Merely By Accepting Taxpayer's Contentions Without Dealing With Findings Of AO: Ahmedabad ITAT
Finding that the CIT(A) has deleted the disallowance merely by accepting the contentions of the assessee before it without dealing with the finding of the AO, the Ahmedabad ITAT directed the CIT(A) to consider the arguments of both the sides before him, i.e. the AO and the assessee, and thereafter adjudicate the issue in accordance with law. The Bench of Annapurna Gupta...
Income Tax Act Doesn't Mandate That Specific Money Deposited In Capital Gain Account Scheme Shall Be Utilized Towards New Investment: Chennai ITAT
The Chennai ITAT held that there is no requirement that specific money as deposited in capital gain account scheme should be utilized towards new investment, and the assessee may make investment from other funds as available with him and the same would not jeopardize the claim of the assessee. Referring to the decision of Sohanlal Mohanlal Bhandari vs. ACIT (104 Taxmann.com 161),...
Only Requirement To Be Fulfilled For Claiming Expenses U/s 57(Iii) Is That They Must Be Incurred Wholly For Earning Income From Other Sources: Ahmedabad ITAT
The Ahmedabad ITAT held that in the absence of the Assessing Officer pointing out as to how despite the assessee's explanation, there was no nexus between the interest-bearing funds and their utilization for making advances for earning interest income, no disallowance u/s 57(iii) of the Income tax Act was tenable. The ITAT explained that the only requirement to be fulfilled for...
Income Tax Authority Should Refrain From Over Analysis Which Leads To Paralysis Of Justice: Bombay High Court
The Bombay High Court, while setting aside the order of the Income Tax Appellate Tribunal (ITAT), held that the authority should refrain from overanalyzing, which leads to paralysis of justice.The bench of Justice K. R. Shriram and Justice Neela Gokhale has observed that the ITAT failed to appreciate the spirit in which the order dated August 23, 2022, was passed by the High Court condoning...
Failure To Record Satisfaction Before Initiating Penalty U/s 271(1)(C) In Gross Violation Of CBDT Circular, Vitiates Penalty Order: Chennai ITAT
The Chennai ITAT clarified that the Assessing Officer has to record his satisfaction before initiating penalty under section 271D of the Income tax Act in respect of violation of the provisions of section 269SS of the Act. As per the provision of Section 269SS, the assessee had to explain the bonafide or genuineness of the cash transaction towards payment of interest in cash, added...
AO Can Make Addition Of Unexplained Cash Credit U/s 68 Only In Previous Year In Which Such Cash Credit Was Made And Assessee Fails To Explain Same: Mumbai ITAT
The Mumbai ITAT clarified that as per the provisions of Section 68 of the Income tax Act, the Assessing Officer is required to make addition of unexplained cash credit only in the previous year in which such cash credit has been made and the assessee is not in a position to offer satisfactory explanation relating thereto. The Bench of Vikas Awasthy (Judicial Member) and...