TODAY'S CASE (DIRECT TAX)

October 31, 2019

++ CBDT is not obligated to issue clarification on request of taxpayer and decide matters which would be essentially in realm of adjudication before Authorities under I-T Act: HC

++ Without recording non-satisfaction of suo motu disallowances having regard to accounts of assessee, claim of exemption on dividend income cannot rejected by invoking Rule 8D: HC

++ Without exhausting all remedies such as stay application against penalty notice, no writ is maintainable: HC

++ Charitable trust is entitled for depreciation on assets acquired from application of income for charitable purposes : HC

++ If no addition is made u/s 115JB or even if proposed disallowance of expenditure under normal provisions is sustained, reopening is not justified: ITAT

++ No penalty is leviable u/s 271D for violating provisions of Sec 269SS if director of company has accepted loan amount as being additional income of taxpayer company: ITAT

++ Mere stay on passing of final assessment order in pursuant to notice u/s 148 cannot be construed as restraining order on AO to not proceed with re-assessment proceedings: HC

++ AO is not barred from issuing second notice of scrutiny assessment after first one was already served prior to grant of stay on passing final assessment order: HC

++ If there are no reasons to hold refund claim, then Revenue must process such return as expeditiously as possible without giving undue hardship to assessee: HC

++ Notice for reopening cannot be issued unless it is established that income has escaped assessment on account of failure of assessee to disclose all material facts fully & truly: HC

++ Addition is to be restricted only up to amount of profit margin involved in bogus purchases, if sale transaction is not in doubt: ITAT

++ Proportionate relief can be allowed on units of housing project once claimant satisfies conditions laid down u/s 80IB(10): ITAT

++ In absence of evidence to indicate utilization of short cash elsewhere during survey action, discrepancies between cash-in-hand & cash balance appearing in books is no ground for addition: ITAT

October 30, 2019

++ Paper return is permissible where procedure of filing e-return bars assessee from making legitimate claim u/s 72: HC

++ AO is obliged to consider DVO's report once such reference is made, before proceeding to estimate FMV of property concerned: ITAT

++ Depreciation is allowable on transport & labor charges which form part of actual cost of any newly-acquired asset: ITAT

++ If capital receipts subtracted from cost of assets are not taxable under any heads of income, then they cannot form part of net profit and consequently not taxable as book profit u/s 115JB: ITAT

++ Quantum of disallowance u/s 14A merits being restricted to taxpayer's income which does not form part of total income: ITAT

++ Notice proposing penalty is invalid if it does not specify exact charges as to either concealment or furnishing of inaccurate particulars: ITAT

++ Calculation of interest does not warrant interference if it is tentative in nature & final working is to be determined only after payment of outstanding tax: HC

++ In case of amalgamation, business of amalgamating concern gets transferred to amalgamated one, and hence recovery of bad-debts written off by erstwhile amalgamating concern will be treated as business receipts: ITAT

++ If benefit of exemption was allowed to charitable trust in past AYs, then merely on basis of subjective opinion, CIT cannot invoke revisionary powers u/s 263: ITAT

++ Order making disallowance of exempt income u/s 14A r/w Rule 8D(2) is not sustainable if such order is non reasoned and more so where rectification application is pending disposal before CIT(A): ITAT

++ If monies deposited in bank a/c was duly recorded in cash book, then such cash deposit cannot be held as income from undisclosed source, especially, without rejecting authenticity of cash book: ITAT

++ If period of holding is more than 36 months, then capital gains is required to be computed after giving cost inflation index: ITAT

++ If intimation u/s 143(1) is different from assessment u/s 143(3), initiation of reopening u/s 147 after such intimation, on finding any escapement of income, cannot be regarded as change of opinion: ITAT

October 29, 2019

++ Writ assailing reopening is not maintenable if taxpayer has not followed proper procedure of filing returns in reply to notice u/s 148: HC

++ Tribunal is empowered to extend stay on operation of an order, beyond period of 365 days: HC

++ While granting stay on recovery of duty, Tribunal is obliged to dispose off pending appeals on priority basis after arranging cases based on seniority and tax amount involved: HC

++ Income received from sale of paintings cannot be treated as business income, if it is shown that paintings are inherited by way of gift within meaning of Sec 2(14): ITAT

++ Deduction claimed towards cost of improvement deserves to be disallowed if assessee fails to discharge its onus to prove genuineness of such claim: ITAT

++ Penalty u/s 271AAB imposed on account of undisclosed income is unsustainable if no incriminating material exists to substantiate allegations of non-disclosure of income: ITAT

++ Reimbursement of Excise duty received by assessee is trading receipt and taxable u/s 41, pursuant to which no deduction is allowed on such amount: ITAT

++ Additions for unexplained credit are not permitted if relevant documents proving genuineness of transactions are substantiated: ITAT

++ No writ is maintainable in cases where effective remedy to approach appropriate authority concerned is available to taxpayer: HC

++ Reopening is not sustainable if notice u/s 143(2) is served in improper manner and without proper application of mind by AO: ITAT

++ Without verification of books of a/c, bills & vouchers, disallowance of expenses on ad-hoc basis is not permitted: ITAT

++ Failure to prove source of cash deposits in taxpayer's a/c despite several opportunities, calls for addition on ground of unexplained cash deposits: ITAT

++ Interest earned on short term export surplus deposit should be treated as business income for purposes of computation of deduction u/s 10A(4): ITAT

++ Compensation paid for breach of contract is revenue expenditure and should be allowed in the year it is incurred: ITAT

++ Taxpayer can be said to have consciously attempted to conceal income if revised return is filed after issuance of notice 143(2)/142(1): ITAT

October 28, 2019

++ Deduction claimed u/s 36(1)(viia) on account of provision for standard asset under Head 'Provision for Bad & Doubtful Debt' is allowable: ITAT

++ Once benefit given is in nature of pure 'trade discount' but not 'commission', then no TDS obligation arises u/s 194H: ITAT

++ For action against issuer company for mis-utilisation of share premium amount, it is not necessary that RoC has to pass order at first place: ITAT

++ Reopening on issue already discussed during original assessment with complete disclosure of data by assessee is invalid: ITAT

++ Taxpayer's failure to substantiate his requirement for obtaining borrowed capital for business purposes calls for disallowance of interest expenditure u/s 36(1)(iii): ITAT

October 26, 2019

++ Registration granted to Gujarat, Baroda & Saurashtra Cricket Associations u/s 12AA cannot be cancelled just because they are members of BCCI: HC

++ If late filing of Form 10 for income accumulation is due to belated & restrospective grant of registration u/s 12AA, there is no reason for not condoning delay: HC

++ Revenue authorities have no justification to doubt percentage of profit earned in JDA if profit generated by firm is supported by books of a/c maintained in regular course of business: ITAT

++ If there is no reasonable basis to reject assessee's submissions, cash deposits made from savings of agricultural income cannot be treated as unexplained income in toto: ITAT

++ No penalty is imposable u/s 271(1)(c) towards unexplained cash deposit if assessee successfully substantiates source of such deposits through relevant evidence: ITAT

++ It is only assessee's prerogative to decide that if any amount becomes irrecoverable, then same can be written off as bad debts in relevant AY: ITAT

++ Since payment of bonus to employees is in ordinary course of business, then expenditure incurred for such purpose is allowable u/s 36(1)(iii): ITAT

October 25, 2019

++ NRA application to recall ex-parte order dismissed for failure to make appearance despite sufficient chances: SC

++ Bank charges are not in nature of commission or brokerage on which tax is to be deducted at source: ITAT

++ No penalty u/s 271(1)(c) is leviable if AO fails to prove that assessee is at fault for furnishing inaccurate particulars of income: ITAT

++ Valuation of land as as adopted by Revenue deserves to be rejected, if assessee was constrained to sell land at lower rates than FMV, on account of a distress sale: ITAT

++ Electricity expenses of directors borne by company should not be disallowed solely on basis of ownership of electricity meter: ITAT

++ Capital gains cannot be treated as business income, if it is shown that the property in question was acquired for investment purposes only & not used for any business activity: ITAT

++ Expenses suo motu disallowed by assessee by filing revised return which was neither confronted nor enquired by AO, will not attract penalty u/s 271(1)(c): ITAT

++ If contract work allocated to sub-contractors is complete, then sub-contract payments cannot be disallowed merely because assistance was provided to sub-contractors for cash management requirement: ITAT

++ Bank charges are not in nature of commission or brokerage on which tax is to be deducted at source: ITAT

++ No penalty u/s 271(1)(c) is leviable if AO fails to prove that assessee is at fault for furnishing inaccurate particulars of income: ITAT

++ Valuation of land as as adopted by Revenue deserves to be rejected, if assessee was constrained to sell land at lower rates than FMV, on account of a distress sale: ITAT

++ Electricity expenses of directors borne by company should not be disallowed solely on basis of ownership of electricity meter: ITAT

++ Capital gains cannot be treated as business income, if it is shown that the property in question was acquired for investment purposes only & not used for any business activity: ITAT

++ Expenses suo motu disallowed by assessee by filing revised return which was neither confronted nor enquired by AO, will not attract penalty u/s 271(1)(c): ITAT

++ If contract work allocated to sub-contractors is complete, then sub-contract payments cannot be disallowed merely because assistance was provided to sub-contractors for cash management requirement: ITAT

++ If records suggest that AO has made due enquiry during assessment proceedings before allowing claim of operating loss and has arrived at one of possible views, then proceedings u/s 263 is bad in law: HC

++ Merits of matter once settled by Writ court in assessee's own case for previous AY need not be disturbed in absence of any distinguishing feature: HC

++ If factual findings are confirmed concurrently by Lower Revenue forums in favour of taxpayer, it does not lead to substantial question of law before writ court: HC

++ If dealer is in position to prove genuineness of its claim qua inter-state transaction, not having Form F declaration does not automatically lead to diallowance of stock transfer of goods: HC

++ Re assessment initiated on basis of information from investigation wing is not sustainable since it is on basis of borrowed satisfaction: ITAT

++ To claim exemption on agricultural income, it is enough that revenue is derived from agro operations which is not subject to pre-condition that agricultural land should belong to claimaint: ITAT

++ If Form No 3CL is mere report for intimation of approval of R&D facility, then same cannot form basis for rejection of claim for R&D expenditure : ITAT

October 24, 2019

++ Loss incurred from trading in any commodity can only be treated as speculative if there is no evidence showing any purchase or sale or delivery of goods: ITAT

++ It is only when agreement is entered to safeguard future losses in respect of price fluctuation of goods, the concept of hedging can be extended to forward contracts: ITAT

++ If interest income accrued from security deposit made to avail electricity connection is integral to business activity, deduction u/s 10AA(7) is available: ITAT

++ Once identity of lenders is proved by furnishing copy of PAN, bank details and loan transactions are carried out through banking channel, then no addition u/s 68 is permitted in absence of any contrary: ITAT

++ If sale is not disputed, addition of bogus purchases should not be more than income element: ITAT

++ Addition for undisclosed income merits being sustained if taxpayer fails to prove otherwise in respect of certain amount: ITAT

++ If there is no dispute about payments made to related parties, ad hoc disallowance of sum of expenditure is not possible without first quantifying excess amount: ITAT

++ Educational society cannot be held to be in default for non-deduction of TDS on interest paid, if recipient of such interest demonstrates such amount in its returns: ITAT

++ Amalgamated company is eligible to take credit of carried forward MAT credit pertaining to amalgamating company: ITAT

++ No addition is permitted in hands of individual, once he substantiates genuineness of his claim along with relevant documents: ITAT

++ Provisions of Rule 8D should be applied only after establishing nexus between expenses sought to be disallowed and earning of dividend income: ITAT

++ Enhancement of quantum of additions towards assessee's income are unsustainable, if CIT(A) omits to provide break up or basis for such enhancement: ITAT

++ Benefit u/s 54B cannot be denied if Revenue fails to prove that land transferred by assessee was not used for agricultural purposes for last two AYs from date of transfer: ITAT

++ Mere non-issuance of instructions to field authorities by state government is no excuse for non-collection of TCS from mining companies by administrative District Magistrate: ITAT

++ Expenses and advances written off in course of business are eligible for deduction u/s 28(i) or u/s 37(1): ITAT

October 23, 2019

++ If TDS remitted earlier to issuance of sanction order do not relate to taxpayer, proceedings are not defective and are not liable to be quashed: HC

++ Once items sold by taxpayer are not different from jewellery declared under VDIS, then no addition is permitted on account of unexplained credits merely for change in nomenclature: HC

++ Ad hoc disallowance out of subscription payments is not permissible without specific mention of services received which are not available: ITAT

++ Once taxpayer discharges its burden by showing reasonable cause for failure to deduct TDS on rent free accommodation at concessional rates, no penalty u/s 271C is warranted: ITAT

++ Valuation of shares should not be made merely on basis of financials and fair market value of land, after conversion from agricultural to institutional: ITAT

++ If taxpayer fails to produce necessary bills & evidences to prove that business is set up and is ready to commence, expenditure incurred prior to setting up of business should not be allowed: ITAT

++ Restriction of addition made towards unaccounted sales by adopting undisclosed gross profit arising from un-metered units, is justifed upto sales accounted in books of a/c: ITAT

++ Once books of account are rejected by AO, then he should have only estimated profits rather than making addition under reopening: ITAT

++ Non-recurring annual receipts from students being absolute nature of development fee collected as admission fee, is capital Receipt: ITAT

++ No depreciation can be denied on leased assets if it was allowed in earlier AYs as well in subsequent AYs under similar circumstances: ITAT

++ Mere furnishing of account copies without confirmations and other details does not prove customer advance and rightly treated as unexplained income u/s 68: ITAT

++ If Trust enjoys benefit of Sec 11 for last many years then in subsequent year without scrutiny, Revenue cannot simply reject such claim on ground that registration number of Trust is not available: ITAT

++ In absence of rejection of books and without summoning scrap dealer to verify genuineness of sales, claim of loss on account of scrap sale of stock sould not be disallowed: ITAT

October 22, 2019

++ Communication made by taxpayer in refutal of allegations pertaining to undisclosed income, must not be construed as admission of non-disclosure: SC

++ Once identity & creditworthiness of investors & genuineness of transactions stood established, no addition is permitted u/s 68 as unexplained cash credit without proving contrary: ITAT

++ If taxpayer has successfully proved identity of shareholders & genuineness of transactions, same cannot be termed as bogus merely on basis of statement of third person: ITAT

++ Gross profit rate in respect of unaccounted credits in bank account merits being restricted to 30% if is pressing evidence pointing towards illicit nature of transactions: ITAT

++ No decision of Tribunal can be reversed in proceedings u/s 254(2) by re-appreciating same facts & decisions canvassed by taxpayer earlier: ITAT

++ Disallowance of interest expenses u/s 14A should not be resorted to while determining expenses under clause (f) to explanation 1 to Sec 115JB: ITAT

++ Assessment framed u/s 153C is invalid if satisfaction is not recorded by AO of searched party: ITAT

++ In order to seek write off of advances or deposits, assessee must establish that same has become bad: ITAT

++ Satisfaction note regarding concealment or furnishing of inaccurate particulars is mandatory before imposing penalty: ITAT

++ Funds misappropriated by former director are to be treated as business loss, if claimant company establishes bona fide nature of its claim: ITAT

++ If Spice Communication has merged with Idea Cellular before reassessment and this fact is known to Revenue, then order passed u/s 147 against such non-existent entity is invalid: ITAT

++ Expenses relating to boundry wall construction & land levelling cannot be disallowed merely for making late payment and suppliers being retail businessmen not produced before AO: ITAT

++ In absence of demonstration that default on deduction of TDS has ceased, cause of action will continue to arise for applicability of section 201 without benefit of limitation period: ITAT

++ Defective penalty notice with no specific charges for such levy, renders entire penalty proceedings invalid: ITAT

++ No addition is permitted for bogus purchases merely based on statements recorded during investigation without giving opportunity to cross examination: ITAT

October 21, 2019

++ Order passed by Tribunal without discussing contentions of parties before finalizing the fact of case, is not sustainable: HC

++ If alternate contentions raised are beyond permissible limits of admitting additional evidence, review petition is not maintainable before Writ Court: HC

++ If basis of diallowance of exemption claimed by educational institution u/s 10(23)(C) is upon wrong application of income tax provisions, then assessment order cannot be sustained: HC

++ Pre-requisite for invoking provisions u/s 41(1) is that taxpayer must have claimed some allowance or deduction which was granted in any AY in respect of any loss, expenditure or trading liability: ITAT

++ Reopening of assessment is valid if AO has sufficient material on record to believe that income has escaped being unassessed: ITAT

++ Once creditworthiness & genuineness of donor stands established and taxpayer has discharged burden casted upon him, then gifts received by him cannot be treated as unexplained investment: ITAT

++ Exemption u/s 10(23C)(iiiab) & (iiiad) merits denial if claimant coaching institute conducts vocational training courses under contract received from State Government: ITAT

++ TDS u/s 194C is to be deducted, if institution receives sub-contract for conducting vocational courses, hence bringing such activity within ambit of term work u/s 194C: ITAT

October 19, 2019

++ No TDS payable u/s 194C on payments made, out of purchase price of Sugarcane, to transport contractors by Sugar producer on behalf of Sugarcane farmers: ITAT

++ Current AY's business loss can be set off against addition made u/s 68 by virtue of prospective effect of amendment to Section 115BBE(2): ITAT

++ CIT(A)'s upholding disallowance of EPF/ESI payments is untenable if based upon a judgment of a non-jurisdictional High Court & in ignorance of a binding precedent of jurisdictional High Court: ITAT

++ Routine expenses incurred on sales promotion cannot be disallowed if Revenue has no reason to doubt their genuineness & cannot prove existence of enduring benefit: ITAT

++ Additions made on any grounds other than those recorded in re-assessment notice are untenable: ITAT

October 18, 2019

++ Service of notice as per PAN database is sufficient compliance of Sec 143(2); Change in address with no intimation to I-T Dept is fault of taxpayer for which he cannot raise limitation issue: SC Larger Bench

++ For computation of eligible deduction u/s 54F in case of sale of long term capital asset, payment made towards purchase of new residential house up to due date of filing belated return, will be taken into consideration: ITAT

++ If allegations of siphoning of funds and forgery based on incriminating documents found during search remained unanswered, case should be remanded to give final opportunity to substantiate case: ITAT

++ In composite sale if assessee fails to give bifurcation of assets and its value which are capitalized and has claimed depreciation in earlier years, then value of land is rightly taken as Nil: ITAT

++ If there is no mechanism to report cash investment in purchase of property by salaried person, such amount does not become undisclosed income within provisions of section 271 AAB: ITAT

++ Merely for non-compliance of notice issued u/s 133(6), addition of unexplained cash credit cannot be made if substantial documentary evidence furnished by assessee are not rebutted by Revenue: ITAT

++ If regarding value of asset, Revenue is not satisfied with Registered Valuer's report then he should refer such matter to DVO: ITAT

++ Provisions of section 153C and not sec 147 are relevant for making assessments and additions based on seized materials: ITAT

++ Disallowance for bogus purchases can be reduced to extent of profit element embedded on such purchase where sales are not in doubt and all payments are through banking channels: ITAT 

++ Profits arising from sale of investments are not to be taxed separately considering that investments made by insurance company are part & parcel of its business & such proceeds are thus, beyond purview of Section 44: ITAT

++ In case of transfer of immovable properties, date of execution of transfer deed in favour of transferee can be said to be trigger point if Revenue is recognised in hand of transferor, and not actual transfer: ITAT

++ In case of composite contract for 'Operation and Maintenance work' of wind turbine, which doesn't mention about supply of any technical services, payment made towards labour is liable for TDS u/s 194C: ITAT

++ If CIT(A) does not get opportunity to examine issues in its entirety due to non-appearance by assessee, it calls for remand order: ITAT

++ Assessee cannot be said to have defaulted in payment of TDS when in fact, there is no obligation on part of assessee to deduct TDS: ITAT

October 17, 2019

++ Transaction of purchase & sale of shares duly supported by documentary evidences cannot lead to bogus claim of LTCG merely based on information received from investigation wing: ITAT

++ Amortization of lease premium can be granted over effective life of lease while computing business income: ITAT

++ Corroborating the amount of addition with entries in seized materials is mandatory task for Revenue before making addition as unaccounted income: ITAT

++ Failure to file return u/s 139(4A) attracts no penalty u/s 272A(2)(e) if income of assessee trust is exempt in view of Sec 10(23C)(iiiad): ITAT

++ If presumption of cash loan advanced to assessee is refuted in assessment proceedings of lender, no penalty order will arise in respect of same transaction: ITAT

++ Once AO has perused information about receipt of bogus purchase bills by assessee after acceptance of return without scrutiny, re-assessment notice cannot be called invalid: ITAT

++ Purchase of different land parcels and their subsequent conversion initially into non agriculture for residential purpose and finally for commercial purpose, can be prima facie held as calculated steps with commercial motives: ITAT

++ I-T - Even though it is not compulsory, serving reasons before hiking TDS rate is standard procedure : HC

++ I-T - If there is no delay in filing appeal, AO's power to review stay order does not extend to lift stay already granted: HC

++ I-T - CIT(A) can admit appeal by hard copy if method of e-appeal is not available to legal heir: HC

++ Exemption u/s 11 claimed by charitable institution cannot be rejected in absence of grant of registration certificate u/s 12A, simply because application for registration was not disposed within due time: ITAT

++ If one of co-owners has been granted deduction u/s 54F in respect of subject property, then AO cannot disallow such deduction in case of other co-owners: ITAT

++ Even if deduction @ 100% is allowed for first five years u/s 80IC to new unit, such claim cannot be reduced to 25% for next five years merely because that unit has been substantially expanded: ITAT

 

October 16, 2019

++ If submissions of taxpayer are not properly addressed at time of first appeal, then FAA must not confirm such assessment order: ITAT

++ Once order of Development Commissioner of SEZ is sub-judice and has not attained finality, then it is fit case for remand: ITAT

++ Once taxpayer has produced relevant evidences to substantiate transaction of purchase & sale of shares, such transaction cannot be held as bogus merely on basis of report of investigation wing: ITAT

++ Merely because there was some unscrupulous actions of few stock market players in scrip of company, entire transaction of such company cannot be held as bogus: ITAT

++ Since Container Freight Station is part of inland port & consequently an infrastructure facility, benefit of deduction available u/s 80IA(4) cannot be denied: ITAT

++ If building is partly let out and partly used by self, allocation of interest on loan taken for construction of such building for claiming deduction u/s 24(b) is appropriate: ITAT

++ No penalty u/s 271(1)(c) should be levied for reconciliation of TDS, if such error is proved to be inadvertent: ITAT

++ Deduction on prior period expenses is to be allowed if liabilty of such expenditure arose in previous year but paid in current AY: ITAT

++ Vocational training run by charitable society aimed at training for employment comes within sweep of education u/s 2(15): ITAT

++ Once taxpayer has successfully discharged his onus cast upon it to prove genuineness of share application money, no addition is permitted in absence of any incriminating material: ITAT

++ Once original return stood processed u/s 143(1), assuming jurisdiction u/s 147/148 by another AO is bad in law, in absence of same being conferred as per due process: ITAT

++ Even though Sec 43B says that certain deductions to be allowed only on actual payment and not on accrual basis, provisions of post retirement benefits based on actuarial valuation is allowable u/s 37(1): ITAT

October 15, 2019

++ Black Money Act - Penal provisions u/s 50 & 51 come into play only upon failure to disclose assets or pay penalty or for not availing benefit u/s 59: SC

++ I-T - If rejection of refund order is not appealable, remedy of revision before CIT is available to assessee from any order of AO u/s 264: HC

++ Once taxpayer discharges his onus by providing all relevant documents towards purchase of jwellery found during search, no addition is called for: ITAT

++ It is fit case for remand if AO has made additions on account of duty drawback & book profit for determining tax liabilty, without proper enquiry & verification: ITAT

++ No penalty u/s 271AAA is leviable for jewellery unearthed during search, if assessee discloses its quantity manner of derivation and had also paid taxes before filing return: ITAT

++ Increase in employee's benefit expenses leading to increase in turnover should not be questioned, as business rational of particular expenditure should not be decided by Revenue: ITAT

++ If Revenue fails to point out any defect in figures mentioned in books of account, then decline in GP rate is no basis for rejecting books: ITAT

++ If original assessment is completed with estimation of income, then reopening on account of escapement of interest on FDR's as other income is justified: ITAT

++ If issues of loss incurred from derivatives businesses are already settled in favour of Revenue, then same cannot be challenged before writ court: HC

++ If assessee is over 70 years, he is immune from prosecution of offence committed u/s 276CC for failure to furnish return within stipulated time: HC

++ If there are technical glitches in computer system which hinder payment of refund, then Department must manually release such amount to assessee: HC

++ Once taxpayer has set off profits from derivative trading with losses incurred from share trading, there is no need to make separate disallowance u/s 73: ITAT

++ If charitable organisation already enjoys exemption u/s 11(1) for past AYs, then principle of consistency requires grant of such benefit in current year as well: ITAT

++ Providing didactical facilities to Universities & colleges which assist them in imparting education are charitable activity to which benefit u/s 11 & section 12 are available: ITAT

++ Penalty levied u/s 271(1)(c) will not survive if foundational issue itself is set aside by Tribunal in quantum appeal: ITAT

October 14, 2019

++ Once books of a/c along with ledgers & bank statement stood explained, entire purchases cannot be termed as bogus on account of differences in opening or closing balance of sundry creditors: ITAT

++ Payment of education cess & provision for warranty are allowable expenditure: ITAT

++ Mere non-reporting of quantitative details in financial statements due to nature of business, cannot lead to rejection of books if no defect is found in sales & purchase invoices: ITAT

++ Lumpsum disallowance is permitted u/s 68 in case of mutual contradictory findings and failure of assessee in discharging onus cast on him to prove liability: ITAT

++ Remaining balance of agreed compensation paid for removing encumbrance and to get clear title, is revenue in nature: ITAT

++ Taxpayer is eligible for TDS credit in same AY in which such income is assessable in terms of Rule 37BA(3)(i): ITAT

++ Pr CIT can exercise power u/s 263 to revise assessment order if AO fails to conduct proper enquiry on deduction claims: ITAT

++ Simply because valuation report based on beneficial provision of sec 55(2)(b) does not depict fair value, it cannot be rejected for lack of evidence: ITAT

++ Once AO is satisfied by disclosure of facts made during original assessment, then re-assessment based on same facts amounts to change of opinion: ITAT

++ Exemption benefit from MAT can be availed by businesses approved by SEZ and not simple developer of housing projects: ITAT

++ Provision for maintenance & free warranty cannot be disallowed while computing book profit u/s 115JB: ITAT

++ No penalty u/s 271C can be imposed for reasonable & non deliberate failure to deduct tax at source: ITAT

++ Penalty levied u/s 158BFA(2) outside limitation period is not maintenable: ITAT

October 12, 2019

++ Lease rental has to be treated as business income following rule of consistency, if similar treatment was given during previous years: ITAT

++ Sec 43CA is not applicable if only right is created in favour of flat buyer in respect of 'property under construction' but no land or building is actually transferred: ITAT

++ If all primary documents in possession as borrower are placed before Revenue, then it's AO's duty to carry out verification before making addition of unsecured loan: ITAT

++ If property dealer has merely developed land and sold same to land owners, then no addition for 'transaction of transfer' can be made in hands of assessee: ITAT

++ Cash deposits are deemed to be unexplained if their source is not established by assessee despite sufficient opportunities: ITAT

October 11, 2019

++ Interest expenditure incurred for earning exempt income cannot be disallowed if interest free funds are over & above such investment: ITAT

++ Non appearance of some lenders before AO in response to notice will not characterize loan transactions as bogus: ITAT

++ Petition seeking stay of outstanding demand of tax and interest is not maintainable, if issue is already pending disposal before Tribunal: ITAT

++ Merely on basis of bald satisfaction of general expenses without pointing out instances, disallowance u/s 14A is not permitted: ITAT

++ Prima facie genuine share transaction made through proper banking channels cannot be termed as bogus in absence of any incriminating material: ITAT

++ Addition of unexplained excess stock merits deletion, if entire purchases are duly reflected in regular books of accounts and payments are made through banking channels: ITAT

++ Deduction claimed on expenditure for earning interest income in current AY cannot be disallowed if it was allowed in earlier AYs: ITAT

++ Reopening merits being quashed if AO is unable to prove that there was no change of opinion on his part in respect of certain evidence: HC

++ Once AO has already made requisite enquiries himself during assessment,  same cannot be reopened by PCIT u/s 263 only for re considering those evidences: ITAT

++ Deduction claimed on expenses merits disallowance in case of failure to prove its genuineness: ITAT

++ If assessee fails to substantiate manner of deriving undisclosed income admitted during search, he becomes liable for penalty u/s 271AAA: ITAT

++ Pre-construction expenses in respect of construction of housing project are required to be capitalized: ITAT

++ No deduction u/s 80IB can be availed on resale of Desi Ghee & Skimmed Milk after removal of guthale & moisture, since it does not amount to manufacture: ITAT

++ Arrangement with middlemen only as facilitators with farmers for cultivation activity, without any seperate payment, cannot be regarded as job contract u/s 194C: ITAT

October 10, 2019

++ Expenses incurred on overseas education of Director's daughter which had no nexus with course of business, are not allowable u/s 37(1): HC

++ If company had filed rectification application seeking correction of mistake which had resulted in delay in filing of appeal, it is 'sufficient cause' and calling for condonation: ITAT

++ Considering perishable nature of item, average rate can be applied for valuation of closing stock to avoid under valuation: ITAT

++ Whether appeal of Revenue having tax effect below Rs. 50 lacs is not maintainable before Tribunal in view CBDT circular putting monetary limit for filing appeals - YES : ITAT

++ Exemption u/s 11 to charitable society is permitted, if surplus income generated is incidental to dominant object of taking care of physically & mentally challenged persons: ITAT

++ Delay on part of Revenue, in filing appeal in Form No 36 for substituting deceased assessee by legal heir, can be condoned upon satisfaction of reasons & cause of delay: ITAT

++ In absence of any contrary, AIR information regarding cash deposits and failure of assessee to file his return, constitute tangible material to form belief that income chargeable to tax has escaped assessment: ITAT

++ Notice for reopening is justified if Revenue has 'reason to believe' that certain income which is chargeable to tax have escaped assessment: HC

++ Notice of re-assessment merits being quashed if it is based on issues already settled during original assessment or based on scrutiny for purposes of fishing inquiry: HC

++ Penalty imposed u/s 271AAA merits being sustained if entire amount of undisclosed income as well as manner of derivation stands duly disclosed by assessee: HC

++ Once request for three-star hotel project stands approved by competent authority, it falls within specified businesses covered u/s 35AD: HC

++ Courts and Tribunals are obliged to record some reasons, even though tentative, while disposing off stay applications as absence of such exercise vitiates any order passed: HC

++ Once differences in TDS claim stood rectified by taxpayer through revised return, there is no justification to make addition on account of suppression: ITAT

++ Whether Tribunal is obliged to look into an appeal filed by the Revenue where the tax value involved is less than the limit prescribed in the Circular No.17/2019 - NO: ITAT

++ Once an issue is not subject matter of scrutiny before CIT(A), then reopening of such issue cannot be opposed by invoking clause (c) of Explanation 1 to Sec 263(1): ITAT

October 09, 2019

++ Absence of documentary evidence to substantiate receipt of cash from agricultural activity and failure to explain source of cash, calls for addition on account of unexplained income: ITAT

++ Deduction of employees' contribution to PF & ESI cannot be availed if it is not made within due date prescribed under respective PF Act & ESI Act: ITAT

++ Expenditure incurred on construction cost of building on leasehold land would be treated as revenue expenditure, once rights on property devolves on lessor at end of lease period: ITAT

++ Failure to prove genuineness of transactions which are alleged as sham based on investigation wing report, calls for addition as unexplained credit u/s 68: ITAT

++ Computation of limitation period runs from date of assessment order and not from re-assessment order: ITAT

++ If foundation of disallowance is proved to be on wrong assumption of fact, it calls for deletion of such disallowance: ITAT

++ If nature of expenses are duly examined by AO, then same cannot be disallowed in revision proceedings merely because CIT has difference of opinion: ITAT

++ Disallowance of unexplained expenditure should be restricted to peak purchases, if assessee fails to produce parties for examination: ITAT

++ Lending money to sister concerns in ordinary course of business are trading transactions which are outside scope of Sec 2(22)(e): ITAT

++ Notice u/s 148 beyond four years of original assessment is unjustified, if reopening is not based on independent satification of AO towards escaped assessment: ITAT

++ Additions based on materials which were already available during assessment cannot be sustained in absence of incriminating materials: ITAT

++ If loan raised in individual capacity is invested in proprietorship concerns for business, interest cost incurred on such personal borrowings is allowable u/s 36(1)(iii): ITAT

++ Disallowance in respect of legal & professional charges is not tenable if such expenditure was for business purposes: ITAT

October 07, 2019

++ I-T - Advances given by one company to another for trading purposes cannot be treated as deemed dividend: HC

++ Order passed by CIT(A) by allowing provision of warranty in current year is sustainable, if Tribunal has adjudicated similarly in taxpayer's own case during earlier AYs: ITAT

++ In absence of failure on part of taxpayer to fully disclose material facts in return, reopening beyond four years is invalid: ITAT

++ It is fit case for remand, if AO before relying on Form No 16 as furnished by employer, failed to grant opportunity of hearing & cross examination: ITAT

++ It is not illegal to rectify 'mistakes' in return relating to figure of bad debts by filing revised return, unless they are not bogus: ITAT

++ Advance received which is to be adjusted by way of supply of energy to holding company, is revenue in nature: ITAT

++ If payment made for surrender of tenancy rights is capital in nature, claiming deduction on payment of interest thereon is not available: ITAT

++ Addition for unexplained cash credit is not permitted if relevant documents proving genuineness of transactions are duly submitted before Revenue: ITAT

++ Defect in accounts is mandatory before rejecting books of accounts u/s 145(3) and making Best Judgment Assessment: HC

++ Subject to compliance of statutory requirements, administrative exigencies of Investigating Agency outweigh practical difficulties of person to be investigated: HC

++ If AO reopens assessment based on materials already available, it would amount to change of opinion: HC

++ Transaction made through proper banking channels will not by itself render prima facie 'bogus share translation' as genuine: ITAT

++ Issuance of notice u/s 143(2) & consequent assessment by subordinate officers after transfer of jurisdiction u/s 127, is non-est in eyes of law: ITAT

++ Claim of increased remuneration to partners can be disallowed merely because stamp papers on which addendum to partnership deed, increasing such remuneration was written: ITAT

++ If after agreement to sale, but, before entering into registered sale deed, physical possession is handed over to buyer on receipt of part consideration, it will constitute 'transfer' u/s 2(47)(v) of I-T Act r.w.s 53A of T.P.Act: ITAT

October 05, 2019

++ It is sufficient for taxpayer to pre-deposit only 1% of total duty demand raised u/s 68 if his appeal is pending disposal before Appellate authority: HC

++ Pr CIT cannot exercise revisionary power, if original assessment order is passed after proper inquiry: ITAT

++ If documents seized during search do not indicate existence of unaccounted income, then they are not 'incriminating evidence' based on which addition is permitted u/s 153C: ITAT

++ Penalty u/s 271(1)(C) is rightly levied if income is disclosed by taxpayer in his return which is not part of Regular Accounts: ITAT

++ If additional evidences filed by taxpayer are not doubted by Revenue, claim of deduction allowed on basis of such evidence cannot be disturbed: ITAT

++ If turnover goes up manifold in relevant year as compared to past years, then trading results is not appropriate guide to make estimation of income: ITAT

October 04, 2019

++ Punjab Cricket association was denied exemption u/s 11 - Revenue said that institution claiming charitable status being barred from involving in commercial activity, cannot form AOP for taking such benefit: ITAT

++ Being chairman in company does not amount to holding 'substantial interest' in terms of Explanation 3 to Sec 13 and hence not violative to provisions of Sec 13(2)(h): ITAT

++ If taxpayer does not discharge his primary onus to prove genuineness of cash credits, no question of law arises with respect to addition u/s 68: HC

++ If taxpayer has any objection in respect of reopening notice, then he is required to submit those objections before notice issuing authority instead of approaching Writ Court: HC

++ If use of machine is not backed by materials that prove usage for more than 180 days, then owner is only eligible for half of depreciation claimed: ITAT

++ Vague explanations to justify delay in filing of appeal will not amount to 'sufficient cause' for seeking condonation: ITAT

++ Revenue cannot override report of registered valuer without making any reference to DVO: ITAT

++ If at relevant time, ITR-2 in force did not provide for any separate column for disclosure of LIC investments, then omission to such disclosure cannot lead to re-assessment: HC

++ Provisions of Sec 115JB will be applicable to Banking/Insurance Companies whose accounts are prepared in accordance of Sec 227(5) r/w/s 211(5) of Companies Act: ITAT

++ If sources of cash found and investments made are not explained, then it calls for impostion of penalty u/s 271AAA: ITAT

++ While estimating availability of cash in hand, fees of professional courses undertaken by kins cannot be claimed as household expenditures by individual: ITAT

++ Substantial part of agricultural income can be treated as Income from other sources, in case of inconsistency in taxpayer's statement and failure to susbtantiate such claim: ITAT

++ Entrance & membership fees received in advance at time of joining golf course, should be brought to tax only in year of its accrual: ITAT

++ Penalty order passed in name of amalgamating company is not procedural irregularity and hence cannot be cured u/s 292B: ITAT

October 03, 2019

++ Acquiring any incriminating material during search is mandatory pre-condition to initiate proceedings u/s 153A, if original or previous assessment is still unabated: ITAT

++ Assessment order u/s 158BC r.w.s 158BD is void, if initiated without intimating assessee regarding transfer of jurisdiction and by not recording satisfaction by jurisdictional AO: ITAT

++ Failure of taxpayer to explain cash deposits renders it unexplained, and hence attracts penalty: ITAT

++ Mere reflection of certain transaction in Form 26AS is not determinative of holding such transaction as taxable in hands of taxpayer: ITAT

++ Even if copy of approval letter u/s 153D is not available in assessment record, contents of affidavits filed by officers coupled with circumstantial evidences are sufficient to establish such fact of approval: ITAT

++ If exemption available u/s 10(26) is not extended by competent authority to tribes of Andaman & Nicobar Island, then tribes of those reigions cannot claim eligiblity to such exemption: ITAT

++ Penalty levied u/s 271E is justified if repayment or acceptance of loan is not found to be genuine u/s 269T and cause shown was not 'reasonable': ITAT

++ If Revenue already concedes that provisions of Sec 41(1) are inapplicable to facts of case, then they cannot raise issue of applicability of such provision again before writ court: HC

++ Disallowance of certain expenses in quantum proceedings is per se no ground to impose penalty: HC

++ Exemption u/s 10(23AAA) is to be allowed in respect of a superannuation fund, if the trust which raised such fund secures approval of competent authority: HC

++ Earning exempt income is mandatory pre-condition for invoking provisions of Sec 14A & Rule 8D to make disallowances of expenditure: ITAT

++ If past loan transaction was not disputed by Revenue in previous assessments, then same cannot be disputed in current assessment merely on basis of statement made by accommodation entry provider: ITAT

++ Toll way rights is intangible asset on which claim of depreciation u/s 32(1)(ii) is allowable: ITAT

++ Addition of deemed income is permitted in case of differences in value of purchase price of land with stamp duty valuation: ITAT

October 01, 2019

++ ITAT empowered to grant registration to trust if dis-satisfied with satisfaction recorded by CIT, albeit such power cannot routinely be exercised: HC Larger Bench

++ Recovery made by secured creditor on account of default in repayment of loan u/s 13 of SARFAESI, cannot be treated as 'diversion of income by overriding title': ITAT

++ Expenses incurred on foreign payment are liable to be disallowed u/s 40(a)(ia) on account of short deduction of tax at source: ITAT

++ Relaxation in monetary limits for filing Departmental appeals as per CBDT Circular 17/2019, has retrospective effect and also applies to pending appeals: ITAT

++ If taxpayer substantiates cash deposit & withdrawal in his bank account, it is reasonable to restrict estimation of income from such deposit by applying rate of 5% in terms of section 44AF: ITAT

++ Loss arising on account of exchange fluctuation at time of conversion of FCNR loan into rupee loan, is allowable u/s 37 as finance cost: ITAT

++ Once SEBI has freed taxpayer from market rigging allegation and declared it as bona-fide investor, AO should not doubting genuineness of transactions undertaken by it: ITAT

++ For making additions as deemed dividend u/s 2(22)(e), transaction in question must fall in category of advances and not one related to immovable property: ITAT

++ In absence any binding decision of jurisdictional HC on issues which are ambiguous or capable of more meanings, Tribunal should adopt view which is favourable to taxpayer: ITAT

++ Once identity, creditworthiness & genuineness of loan transaction stands proved, then conclusions drawn on basis of irrelevant material is no ground for treating loan as income u/s 68: ITAT

++ Mere refusal by AO to rectify mistakes as pointed out by assessee, by giving valid reason that such mistake is not apparent from record, is no ground to oppose reassessment: ITAT

++ DLC rate as on date of 'agreement to sell' shall be taken as full value consideration for calculating capital gains, if part consideration was received through banking channel: ITAT

++ If under JDA, no approval was secured by builder from concerned authorities as pre-condition to enter scheduled property, it can be said that there was no permissive possession of such property in favour of builder: ITAT

++ If AO makes reference to DVO for valuation of property, then within two weeks time he cannot complete assessment with re-computation of LTCG without waiting for DVO report: ITAT

++ Properties held as stock in trade cannot be subjected to deemed rental income under head house property: ITAT

++ For computing FMV of shares allotted, intrinsic value of all assets as on date of issue of shares should be taken and book entry for recognition of intrinsic value is not relevant: ITAT