TODAY'S CASE (DIRECT TAX)

January 31, 2020

++ Quantum of disallowance u/s 14A cannot exceed that of the exempted income earned by assessee: ITAT

++ CBDT Circular No.5/2012 is inapplicable to a pharmaceutical company - Hence, disallowance of advertisement & promotion expenses is not tenable: ITAT

++ Original assessment order would be erroneous & prejudicial to Revenue's interests if it displays blatant lack of enquiry by AO: ITAT

++ Provisions of Section 43A dealing with capital a/c transactions are inapplicable where no long term loan liability is involved & where fixed assets have negligible value: HC

++ AO cannot raise quantum of disallowance u/s 14A r/w Rule 8D on without point out fallacies in suo motu disallowance made by assessee: ITAT

++ Credit for tax deducted at source need not be allowed in absence of assessable income in a particular AY: ITAT

++ Interest income earned on investments made with cooperative banks is eligibile for deduction u/s 80P(2)(d): ITAT

++ Additions framed u/s 68 are unsustainable where directors of investor companies are called forth to establish identity & creditworthiness of such companies: ITAT

January 30, 2020

++ Writ court need not interfere with assessment order where assessee also has statutory remedy of filing appeal before CIT(A): HC

++ Re-assessment cannot be commenced on grounds similar to those on which proceedings u/s 153C were initiated & then dropped: ITAT

++ Higher degree of proof is needed if existence of entities who contibuted in share application, is in doubt - Few documents cannot sufficiently establish identity & creditworthiness of parties: ITAT

++ Where investee company did not respond to inquiry made by AO, then onus shifts on assessee to explain their sources & creditworthiness: ITAT

++ It is trite law that for compounding of offence u/s 271C(1), the amount payable is 100% of tax sought to be evaded & not 100% of total income: HC

++ Depreciation on software warrants disallowance if such asset is purchased from non-existent or bogus companies: ITAT

++ Shares in trade producing incidental dividends to be treated as exempt income when computing disallowance u/s 14A: ITAT

++ Port charges paid to C&F agent do not qualify as payment made on account of professional services rendered u/s 194J: ITAT

++ Income tax returns of creditor can sufficiently prove creditworthiness, in absence of specific confirmation letter in respect of such cash transaction: ITAT

January 29, 2020

++ Holidays are declared by Govt for rest & relaxation of its employees - CIT(A) is advised to confine hearing of appeals within working hours of I-T Department: ITAT

++ Working in late hours only to pass cryptic or non-speaking order is prejudicial to health & well-being of officers & to assessees' interests too: ITAT

++ Proceeds from sale of agricultural land are includible in computation of book profit, if the same is permitted in assessee's own case for earlier AY: ITAT

++ Substantial justice would prevail over technical considerations - Dismissal of appeal for not being filed electronically, is unsustainable: ITAT

++ Disallowance u/s 14A of expenses incurred in relation to exempt income, cannot exceed quantum of such exempt income: ITAT

++ Penalty is not imposable if issue of deducting TDS on EDC is debatable & forms reasonable cause for non-deduction of TDS: ITAT

++ Writ court need not interfere with bogus purchases as calculated by ITAT, where the figure arrived at balances profit from bogus purchases & profits already declared: HC

++ Amount payable for security component forming part of PSF is payable by airline company directly to CISF - Hence exempted from liability to deduct TDS: ITAT

++ Additional deduction u/s 80G cannot be allowed by the Tribunal where expenditure incurred on donation is disallowed: ITAT

++ Setting off unabsorbed depreciation of proprietorship allowed to partnership firm upon conversion & succession by inheritance u/s 78(2): ITAT

January 28, 2020

++ Expenses disallowed by the CPC is a debatable issue - Appeal therefrom lies before CIT(A) & not before CPC for rectification u/s 154: ITAT

++ Disallowance u/s 40(a)(ia) is unsustainable if tax deductor satisfactorily proves that taxes due were paid by the deductee: ITAT

++ Reasons for reopening based solely on suspicions are tantamount to change of opinion - Notice issued u/s 148 becomes invalid: ITAT

++ Additions u/s 68 on account of unexplained cash credits sustained where assessee benefited from accommodation entries issued by bogus company: ITAT

++ Re-assessment - Tribunal's intervention is unwarranted if CIT(A)'s findings of such proceedings being based on change of opinion, are not rebutted: ITAT

++ Re-opening of assessment is invalid if based on change of opinion & where no clarifications are sought from assessee within 4-year limitation period: HC

++ If AO deals with assessee's objections to re-assessment point by point, it does not entail that presumption of validity of reasons to believe, have been rebutted by assessee: HC

++ Expenditure incurred on daily basis, on account of legal assistance sought, is to be treated as revenue in nature: HC

++ Additions framed u/s 68 are not tenable if based solely on statements not corroborated by further evidence & without permitting cross examination of the deponents: HC

++ If scheme of merger is approved & assets of amalgamating company are transferred, then amalgamated company is eligible for depreciation on goodwill under Explanation 3(b) to Sec 32(1): ITAT

January 27, 2020

++ Deduction u/s 54 allowed within 3-years' period, where old capital asset is replaced by new one, which was booked as un-constructed before accrual of LTCG: HC

++ CIT is empowered to overlook mandate of CBDT Circular in favor of a judgment rendered by a higher authority in respect of waiver of interest u/s 234B: HC

++ If an amount is received by labor union towards settlement of dispute, then not including it in account books will not change its nature from exempted to taxable income: HC

++ Re-assessment - Additions are unsustainable if based solely on findings of a State inquiry commission & do not involve independent probe by AO: HC

++ Goodwill earned by a company is equivalent to any other business or commercial right as per Explanation 3(b) to Sec 32(1)(ii) & is eligible for depreciation: ITAT

++ Ad hoc disallowance of expenses on staff welfare, club, community development & HRD training, is unsustainable, if their being incurred for non-business purpose is not shown: ITAT

++ Brought forward unabsorbed depreciation can be set off against income from house property & income from other sources where such depreciation pertains to current AY: ITAT

++ If assessee exercises option of exemption for one self-occupied residential property, the same cannot be altered to allow exemption on another property: ITAT

++ Interest income inextricably linked to setting up plant, is to be capitalized against pre-operative expenses & cannot be treated as income from other sources: ITAT

++ Interest income inextricably linked to setting up plant, is to be capitalized against pre-operative expenses & cannot be treated as income from other sources: ITAT

++ Re-assessment proceedings are unsustainable where not based on any fresh material & if grounds thereof are already allowed: ITAT

January 25, 2020

++ No material evidence is needed to substantiate retraction of statements recorded under coercion: ITAT

++ Provisions for doubtful debts must be deducted when computing a Trust's income available for application to charitable purposes: ITAT

++ Non-availability of PAN of deductee is not reasonable cause to explain delay in deducting TDS: ITAT

++ Mandate u/s 68 is not fulfilled if assessee does not establish source of cash credits or genuineness & creditworthiness of depositors: ITAT

January 24, 2020

++ Reasons to believe for re-assessment are unsustainable where they merely re-iterate reasons already given to dispose off assessee's objections to such proceedings: HC

++ Claims of payment of interest on borrowings are rightly disallowed where cogent reasons are recorded to such end upon examining factual aspects: HC

++ Tax value involved in matter is less than Rs 50 lakhs - Matter remanded to CCIT, in keeping with CBDT Circular issued u/s 119: HC

++ If no exempt income is earned in relevant AY, expenditure incurred cannot be disallowed by following CBDT Circular, rather than provisions u/s 14A: ITAT

++ Deduction u/s 37 allowed on commission paid to agents for referring names of & introducing potential customers, as such activity qualifies as service: HC

++ Deduction u/s 36(1)(iii) of interest expenditure cannot be disallowed solely on ground that assessee did not use borrowed funds to meet genuine commercial expediency: ITAT

++ Quoting an incorrect provision of law does not preclude the Revenue from framing disallowance which is otherwise warranted: ITAT

++ Assessee cannot be held to be in default u/s 201(1) regarding interest paid to an entity falling under ambit of Section 194A(3)(f): ITAT

++ Incentives paid to employees cannot be disallowed u/s 40(a)(ia) if such payments are of the nature of salaries u/s 192: ITAT

January 23, 2020

++ Service charges do not qualify as business charges when profit earned by assessee has no direct nexus with export activity: HC

++ Assessee failed to sufficiently explain cause of delay in filing returns - Writ petition dismissed as it does not espouse any public cause: HC

++ If assessee is able to demonstrate overvaluation by Survey team, then additions made to assessee's income are not tenable: ITAT

++ Deduction is allowed on income from exporting software from 100% EoU under STP scheme, as long as conditions u/s 10A are satisfied: ITAT

++ If deduction u/s 35(1)(ii) on donation is allowed in preceding AY, such benefit can be allowed in current AY as well, in identical facts & circumstances: ITAT

++ Assessee's claim of netting off interest received on tax refund as against interest paid u/s 234B & 234C is correct - Exercise of Revisionary powers unwarranted: ITAT

++ Payment made to ward off rival competition in a particular line of business is aimed at increasing efficiency & profitability - Hence deductible as revenue expenditure: ITAT

++ AO cannot add on to the reasons recorded for re-opening assessment, while conducting such re-assessment proceedings: ITAT

January 22, 2020

++ Provisions of Section 2(22)(e) are inapplicable in respect of an amount receved from a company in ordinary course of business: ITAT

++ Cash payments made to meet urgent business requirements in unfavorable conditions, deserve to be allowed u/s 40A(3): ITAT

++ Loss incurred from share transactions on a recognized stock exchange is normal business loss - Such loss can be set off against income of assessee: ITAT

++ Under mercantile system of accounting, liability for prior period expenses is allowed in that AY in which such expenses were crystallized: ITAT

++ Original assessment order passed u/s 143(3) upon transfer of jurisdiction, is invalided, where procedure for transferring assessment u/s 127 is not followed: ITAT

++ Strict guidelines issued to AO to meet finality of remand order, in light of AO's perseverance in acting beyond the brief of such order: HC

++ AO computed net profit rate through stock register, delivery challans, work orders & without application of mind to arrive at such figure - Remand ordered by ITAT is correct: HC

++ Assessee's claims of making bona fide error in filing ITR-4 returns merit consideration - Matter remanded to verify evidence furnished in support thereof: HC

++ Scope of the term relative u/s 56 of I-T Act includes relation of brother-in-law - Cash gift received therefrom cannot be invalided by treating as not genuine transaction: HC

++ Manufacturer is eligible for deduction u/s 80IA for ten consecutive AYs, commencing from AY in which it exercised such option: ITAT

January 21, 2020

++ Penalty u/s 271(1)(c) imposed subsequent to search operations is justified if assessee concealed particulars of income, unlikely to be uncovered if not for the Search: ITAT

++ Wealth Tax - Assessee cannot revise value of jewellery declared in returns, where its true value has been ascertained by the High Court's orders passed in a criminal matter involving the same jewellery: ITAT

++ Re-assessment proceedings are unsustainable where approval for the same is accorded mechanically & without due application of mind: ITAT

++ It is fit case for remand to probe angle of misuse of corporate veil in respect of share premium received by assessee-company: ITAT

++ Vires of re-assessment proceedings cannot be assailed without establishing that reasons recorded for re-opening assessment were not per mandate of Section 147: ITAT

++ Disallowance u/s 40(a)(ia) is not sustainable where framed in cases of short deduction of TDS: ITAT

++ Expenditure incurred to earn exempted income once self-disallowed by assessee, cannot be disallowed again u/s 14A or MAT provisions: ITAT

++ Taxing profit element embedded in bogus purchases is sustained, if corresponding sales are not doubted & considering relevant judicial precedents: ITAT

++ Deduction u/s 10B is allowed in respect of a unit which is received by the assessee-company under a scheme of amalgamation: ITAT

January 20, 2020

++ No further additions are necessary where assessee disclosed substantial amount of income as unaccounted on-money: ITAT

++ Disallowance of bogus purchases merits being restricted to profit element embedded therein - Disallowance of 10% suffices to meet ends of justice: ITAT

++ Where only 5% of a total area of land is constructed upon, it cannot be said that the rest of the land is appurtenant thereto: ITAT

++ If assessee submits evidence to discharge burden of proof u/s 68, then additions are justly quashed if Revenue fails to discharge onus of rebutting the same: ITAT

++ Penalty u/s 271B is unwarranted where assessee fails to get books of accounts audited owing to being under some bona fide belief: ITAT

++ Board established to impart secondary education in a State need not produce exemption certificate so as to claim such benefit u/s 10(23C)(iiiab): HC

++ Reasons to believe are not equatable with reasons to suspect - Re-assessment is not tenable if based on change of opinion: HC

++ Review of an order is impermissible in absence of any error apparent on face of record: HC

++ Expenses incurred for scientific research are acceptable if separate books are maintained for them at the end of every AY & are audited regularly: HC

January 18, 2020

++ On appeal, the High Court finds that both issues raised by the Revenue stand settled against the Revenue in different cases. Hence no substantial question of law arises for consideration.

++ ITAT omitted to consider issue of limitation going into the root of the matter, merely because assessee filed no cross objection to Revenue's appeal - Matter remanded: HC

++ On appeal, the HC observed that since the assessee has entered appearance, formal service of notice stands dispensed with. The matter is listed under an appropriate heading for the purpose of final disposal of this appeal on the basis of the substantial questions of law.

++ Where AO refuses to record comments on additional evidence submitted by assessee before the CIT(A), then AO cannot allege contravention of Rule 46A: HC

January 17, 2020

++ Provisions of Section 2(22)(e) are not attracted to transaction where advance is received in normal course of business & not as loan: ITAT

++ Re-assessment proceedings are untenable if based solely on information received from Investigation Wing & not involving any independent enquiry by AO: ITAT

++ AO has jurisdiction to pass order u/s 143(3) even if returns are selected for scrutiny without identifying any particular issue: ITAT

++ Agricultural land converted into residence upon registration of sale deed becomes capital asset - Income accrued not exempted u/s 2(14): ITAT

++ CIT cannot exercise power of revision without undertaking any enquiry to record satisfaction for undertaking such exercise: ITAT

++ Clarificatory circular is not binding on Tribunal & Courts in interpretation of Income Tax Act: HC

++ Exercise of revisionary power u/s 263 is not tenable where nothing indicates that AO passed assessment order without application of mind: ITAT

++ An order granting interest to assessee, without any inordinate delay in disbursal of refund, is erroneous & prejudicial to Revenue's interests: ITAT

++ In absence of evidence of inflation of construction costs, AO cannot alter the percentage as indicated by assessee, on grounds that estimated cost of housing project is lesser than that declared in books: ITAT

++ Section 46A is charging section for gains arising from buy back of shares & would prevail over general provisions of Section 45 for taxation of capital gains arising from transfer of capital asset: ITAT

January 16, 2020

++ Error made by trust in making any claim under a wrong heading, must be factored in when determining its eligibility for exemption u/s 11: HC

++ Reasons for re-opening assessment are untenable where based on objections raised by Audit Wing & where such objections are not accepted by the AO: HC

++ Re-assessment proceedings are vitiated in absence of valid issuing of jurisdiction notice u/s 148: HC

++ Power of revision cannot be exercised where assessment proceedings stand quashed & such finality is accepted by the Department: HC

++ Premium paid on acquisition of securities can be amortized if it was acquired at the rate higher than their face value: HC

++ Expenditures incurred in respect of machineries rendered obsolete & which are not sold, cannot be allowed: HC

++ Assessee's PAN cannot be declared invalid & assessee cannot be subjected to proviso to Section 139AA(2), for not linking PAN & Aadhar: HC

++ Writ remedy can be availed without exhausting appellate remedy, if the High Court observes the assessment order to be prima facie unsustainable: HC

++ Provisions of Section 293 do not make an absolute bar to suit filed in Civil Courts with regard to any proceedings held under the Income Tax Act: HC

January 15, 2020

++ Salary expenses cannot be disallowed where AO fails to show that salary paid is excessive or unreasonable in terms of the fair market value of services rendered: ITAT

++ Addition framed for undisclosed sale of Katha is untenable where forest department report tallies with assessee's stock register, confirming destruction of liquid Katha: ITAT

++ In case of conflicting judgments of two non-jurisdictional High Courts, a view favoring the assessee should be taken - Hence, late TDS deduction fee not leviable for period prior to 01/06/2015: ITAT

++ Disallowance of cash payments u/s 40A(3) is unsustainable if purchase transactions are found to be genuine & free from vice of any device of tax evasion: ITAT

++ Assessee must first exhaust statutory option of appeal to CIT(A) before filing Writ petition, so as to challenge re-assessment notice: HC

++ Where an individual asset loses its identity in case of block of assets, then depreciation can still be allowed on residential premises as per u/s 24(a) if not claimed: ITAT

++ Provisions of Section 194H are inapplicable on sale of pre-paid cards and recharge coupons to distributors: ITAT

++ If assignment of keyman insurance policy occurred before it was made taxable on maturity by the prospective amendment brought to section 10(10D), allowing exemption on such allocation will not render assessment prejudicial to Revenue's interest u/s 263: ITAT

January 14, 2020

++ Recovery of duty demand raised merits stay where appeal against such order is pending disposal & where pre-deposit is made: HC

++ Re-assessment order is unsustainable if passed without proper enquiry into evidence recovered during Search operations: ITAT

++ Assessee cannot challenge transfer of jurisdiction for assessment at a later stage, where it originally accepted the same: ITAT

++ Guidelines issued by the CBDT have overriding effect in respect of specific provisions in Wealth Tax Rules for valuation of rented properties: ITAT

++ Re-assessment proceedings warrant stay where objections against the same are pending consideration before High Court: HC

++ Writ petition is not maintainable where all parties likely to be affected by its outcome, have not been impleaded in the case: HC

++ Additions solely based on information gathered from Investigation Wing & without independent satisfaction recorded by AO, are unsustainable: ITAT

++ JCIT cannot exercise functions of an AO to pass assessment order u/s 143(3), more so where jurisdiction for the same has not been transferred by the CIT u/s 127: ITAT

January 13, 2020

++ 20-day delay in filing appeal merits being condoned - Recovery proceedings stayed pending disposal of appeal: HC

++ Search assessment proceedings are void & illegal where procedure for obtaining approval u/s 153D for the same, has not been followed: ITAT

++ Additions framed u/s 68 are unsustainable where based on statements of third party & without permitting assessee to cross examine the deponent: ITAT

++ Disallowance u/s 40(a)(ia) is unwarranted in case of inadvertent short deduction of TDS - Nonetheless, AO is within rights to declare assessee is being in default u/s 201: ITAT

++ Interim stay granted can continue beyond 365 days in cases where delay in disposal of appeal is not attributed to assessee but is due to heavy pendency of cases before Tribunal: HC

++ Profit earned by state cricket association from hosting of international cricket matches & from sale of tickets, does not lead to inference that such association indulges in commercial activities: HC

++ Replacement of machineries as a whole cannot be considered as current repairs or be allowed as revenue expenditure: HC

++ If payment made by assessee is not taxable in India as per relevant DTAA, no TDS is deductible on such payments - Ergo, its disallowance u/s 40(a)(ia) is unwarranted: ITAT

++ Where provisions of doubtful debts already are added back in preceding AY & credited in current AY, such debts be excluded when computing book profits u/s 115JB: ITAT

January 11, 2020

++ Claim of having incurred expenditure does not per se lead to its allowance - cogent evidence must show that such expenditure was incurred to earn income: ITAT

++ Re-assessment order is vitiated if approval for the same is accorded mechanically without stating reasons for conducting such exercise: ITAT

++ Peak cash credit as determined by AO cannot is untenable where assessee declared gross turnover which is also part of cash deposits: ITAT

++ It is trite law that only the profit embedded in unaccounted cash receipts is taxable, rather than the entire amount received: ITAT

January 10, 2020

++ Failure to specify exact limb of Section 271(1)(c) for commencing penalty proceedings, between furnishing of inaccurate particulars or concealment, vitiates penalty order: ITAT

++ Unused sale consideration deposited in capital gain scheme beyond limitation period of section 139(1) but within section 139(4), is eligible for computation of deduction u/s 54F: ITAT

++ If trading activities of assessee are bifurcated into multiple categories, without disclosing details of segregation, taxpayer cannot challenge rate of net profit estimated by CIT(A): ITAT

++ Central Government Account (Receipts and Payments) Rules, 1983 are inapplicable to online payments, but are applicable to payments made through cheque: ITAT

++ Revisionary order directing inclusion of addition u/s 14A when computing book profit u/s 115JB, cannot be sustained, if such order is passed contrary to precedent judgment of Tribunal: ITAT

++ Failure to establish genuineness of documents by AO before its final assessment calls for remand of matter: ITAT

++ Deduction already claimed u/s 24(a), cannot be allowed for further deduction under property tax: ITAT

++ Before making addition u/s 68 in hands of assessee, AO should examine & verify copies of affidavits, confirmations and bank statements given by certain creditors: ITAT 

++ Commission paid by assessee to its holding company, which was held as colourable device to inflate expenses, while making addition u/s 37(1), cannot make way for disallowance u/s 40(a)(ia) for failure to deduct TDS: ITAT 

++ Penalty imposed u/s 271AAB is not sustainable if assessee who suffered such penalty is not subjected to search proceedings u/s 271AAB: ITAT

January 09, 2020

++ Delay in filing appeal merits being condoned where Revenue is not prejudiced by hearing issues on merits beyond time prescribed u/s 249: ITAT

++ Re-assessment proceedings are unsustainable where solely based on information from Investigation Wing & not involving independent application of mind by the AO: ITAT

++ Where existence of liabilities are in doubt, they can be treated as unexplained cash credits u/s 68 but cannot be made taxable u/s 41(1): ITAT

++ Penalty u/s 271(1)(c) cannot be imposed based on assumptions where assessee puts forth bona fide evidence in respect of alleged bogus purchases: ITAT

++ Certificate of Gram Panchayat validates construction of house property where no approval or permission is necessary: ITAT

++ AO cannot assume jurisdiction to initiate proceedings u/s 153C without establishing that material seized during Search operation belongs to the person subjected to such proceedings: ITAT

++ Re-assessment proceedings are unsustainable where approval for the same is accorded in a mechanical manner & without application of mind: ITAT

++ Depreciation on office equipment merits being allowed in current AY, where such issue stands resolved in assessee's favor in previous AYs also: ITAT

January 08, 2020

++ Financial stringency is no basis to seek departure from remittance of TDS, and hence such default attracts penalty u/s 221: HC

++ Reassessment notice issued to amalgamated company which ceased to exist after approval of composite scheme of arrangement is illegal: HC

++ Exercising power of revision is justified if AO did not inquire into assessee's eligibility for higher rate of depreciation & simply relied on details provided in financial records to allow the same: ITAT

++ Disallowance u/r 8D is untenable if there is no opening balance or closing balance of any investment, due to which average value of investment cannot be computed: ITAT

++ Re-assessment proceedings are invalid where based on mere surmises in respect of bogus purchases: ITAT

++ Difference in value when purchasing diamonds is treatable as unexplained expenditure as per proviso to Section 69C - such amount is not includible in closing stock or allowable as deduction: ITAT

++ Estimation of net profit merits being restricted to 5% if the actual rate was based on original returns, whereas the assessee later filed revised returns & withdrew the original one: ITAT

++ Defective or incomplete books of account cannot be used to correctly compute profit: ITAT

++ It is settled law that deduction u/s 10A precedes the exercise undertaken to arrive at total income of the assessee: ITAT

++ Exemption u/s 10(23C) merits being allowed to a regulatory commission overseeing operations of private universities, as such commission does not exist for profit motive: ITAT

++ Penalty u/s 271AAB merits being restricted to 10% if undisclosed income is surrendered by assessee u/s 132(4) & manner of deriving such income is disclosed & where taxes due are paid with interest before due date: ITAT

++ Exemption u/s 35(2AB) merits being disallowed if the claimant is unable to fulfil pre-requisites of such provision in a time-bound manner: ITAT

January 07, 2020

++ Expenditure incurred by Cement company in obtaining mining lease from sick unit which entails extraction of minerals to surface for possible future is capital in nature : HC

++ Assessment done by new AO pursuant to transfer of jurisdiction, is liable to be quashed, if such transfer is not sanctioned by the competent authority: ITAT

++ Re-assessment proceedings are not sustainable where carried out despite full & true disclosure of material facts by the assessee: ITAT

++ Complaint alleging misuse of identity of an assessee's account will not affect additions made upon assessment of such account - Assessee can recover value of such addition from the impostor: ITAT

++ Fair market value of an asset on the date of conversion is deemed to be full consideration received on transfer, consequently forming cost of acquisition of stock in trade: ITAT

++ Re-assessment proceedings are sustainable if returns are accepted & processed u/s 143(1) without scrutiny & later the AO receives information from Investigation Wing, leading to reasonable belief of income escaping assessment: ITAT

++ Revisionary power cannot be exercised if even one of the two prerequisites, namely the order in question being erroneous & also prejudicial to Revenue's interests, is not satisfied: ITAT

++ Writ court's intervention is unwarranted in respect of Tribunal's order remanding issue of transfer of physical possession of property for taxation as capital gain u/s 50C: HC

++ It is fit case for remand where addition u/s 68 is framed without properly examining witnesses, affidavits & evidences: HC

January 06, 2020

++ Upon assessment u/s 153A, addition framed for unexplained cash credits are sustainable only if based on incriminating material recovered during search or survey operations: ITAT

++ Benefit u/s 54B of I-T Act is not available in respect of investments made by the assessee's spouse: ITAT

++ Exercising power of revision u/s 263 is invalid where CIT seeks to revisit any issue on which AO has already made proper enquiries: ITAT

++ Where it is unclear as to whether on-money received exceeds the sale consideration, then addition can be made only of the estimated profit & not the entire amount: ITAT

++ Re-assessment proceedings are unsustainable if based on material already on record during original assessment: HC

++ It is settled law that unrealised sale proceeds in foreign exchange are to be excluded from total turnover when computing deduction u/s 10A: HC

++ Revenue cannot prematurely reject approval for exemption u/s 10(23C)(vi) without ascertaining through assessment as to if the claimant complied with statutory provisions: HC

++ Re-opening of assessment is unsustainable if approval for the same is given mechanically & without recording satisfaction: ITAT

++ Relatively short holding period of shares & multiple transactions of short selling, lead to inference that such transactions are those of trading & not investment: ITAT

January 04, 2020

++ Where assessee's own funds are sufficient for purpose of making investment, disallowance of interest expenditure u/s 36(1)(iii) is unwarranted: ITAT

++ Exercise of revisionary powers is unjustified merely because the PCIT opines that the AO should have made some more inquiries into a certain issue: ITAT

++ Delay in submitting Tax Audit Report is not valid grounds to impose penalty u/s 271B as long as such report is filed within due date prescribed u/s 44AB: ITAT

++ Disallowance u/s 40(a)(ia) for not deducting TDS u/s 194C on payment made to contractor, is untenabl, if date of payment precedes date of enactment of Section 194C: ITAT

January 03, 2020

++ Penalty need not be imposed where issue of taxability of profits of foreign branch is debatable in nature: ITAT

++ Pro rata interest on amounts advanced to sister unit need not be disallowed where such amount is loaned on grounds of commercial expediency: ITAT

++ Assessee cannot assail vires of penalty notice on grounds that AO did not strike off irrelevant limb of Section 271(1)(c), where assessee understands the terms of the SCN & files reply thereto: ITAT

++ Tribunal's intervention is unwarranted where assessee fails to satisfactorily explain nature of transaction before the CIT(A): ITAT

++ Expenses incurred on payment of commission cannot be disallowed based solely on statements alleging payment of excessive amounts of commission: ITAT

++ Writ court need not delve into merits of appeal where tax value involved is lesser than the limit prescribed in the relevant CBDT Circular: HC

++ If benefit from deduction of TDS on interest payment made on foreign currency loan is granted by Govt, then indirect use of such loan to repay earlier working capital loan, will not be hit by provisions of Section 40(a): HC

++ If activities of Special Board set up for acquisition of Mysore Palace remain the same in past & current AYs, then exemption u/s 10(46) can be notified retrospectively: HC

++ Assessee was not present at hearing due to defective notice - application for recall of order was dismissed on limitation - writ jurisdiction is appropriate remedy - matter remanded: HC

++ Power to refuse additional evidence u/r 46A can be relaxed in interest of substantial justice: ITAT

January 02, 2020

++ I-T - Law applicable on first day of AY be reckoned as applicable law for assessment for such AY, ergo, provisions of Sec 144C are applicable prospectively from AY 2011-12 only: HC

++ Additions on account of unexplained cash credit are unsustainable if loan is given & repaid through banking channels & requisite documentation to support such transaction are produced: ITAT

++ An amount which is written off as irrecoverable qualifies for deduction u/s 36(1)(vii): ITAT

++ Concessional loan given to recipient who is not an employee of the lender is not taxable under profits in lieu of salary: ITAT

++ Any amount cannot be deemed to be income from other sources, based on suspicions alone: ITAT

++ Converting yarn into thread qualifies as manufacturing activity eligible for deduction u/s 80IC if such thread is used for making garments only & not for any other purpose: HC

++ Karnataka High Court not vested with jurisdiction to hear appeal filed against order passed by Delhi bench of ITAT; Revenue to file fresh appeal before jurisdictional High Court: HC

++ Any amount which is debited as doubtful debt under the financial statement cannot be written off as bad debts: ITAT

++ Book profit merits being calculated afresh where AO erroneously deducts incorrect amount of exempt agricultural income: ITAT

++ Assessee, a public sector bank, is not obliged to deduct TDS on reimbursement of expenditure incurred on LTC during foreign travel: ITAT

January 01, 2020

++ Losses incurred on account of forfeiture of share application money is to be treated as business loss: ITAT

++ Payment of annual lease rent amount qualifies qualifies as revenue expenditure, rather than capital expenditure: ITAT

++ No TDS is to be deduction u/s 194H upon absence of principal-agent relationship between bank & contractor, during issue of bank guarantee by the former: ITAT

++ Client Code Modification transactions cannot be interpolated or manipulated when commissions made to the broker are through regular channel at prescribed rates: ITAT

++ Assessment order is rightly quashed by CIT(A) where issued in the name of an amalgamated company which has ceased to exist: ITAT