TODAY'S CASE (DIRECT TAX)

June 27, 2024

++ I-T- Faceless Assessment - Section 144B mandates granting a personal hearing; order passed without meeting this procedural requirement, is invalidated: HC

++ I-T- Re-assessment invalid where based entirely on information supplied by NSE; no application of mind, evidence such as statutory audit report not considered by AO: HC

++ I-T- Re-assessment rightly commenced where assessee provides no evidence to justify claims of being engaged as a land aggregator, opening up possibility of income having escaped assessment: ITAT

++ I-T- Following Tribunal order in assessee's own case, exemption claimed u/s 11 can be allowed: ITAT

++ I-T- Service of notice u/s 148 of the Act is a mandatory statutory requirement for framing an assessment u/s 147: ITAT

++ I-T- Assessment order passed in the name of a non-existent company, despite being informed of the amalgamation, is null and void: ITAT

++ I-T- Once AO has made addition u/s 69 same cannot be cured in subsequent proceedings : ITAT

June 26, 2024

++ I-T - Assessee's additional income is taxable as 'Business Income and no addition is needed u/s 69: ITAT

++ I-T- Assessee is entitled to claim of deduction u/s 80P(2)(d) towards interest earned on deposits with cooperative banks : ITAT

++ I-T- Section 69A is not applicable to transactions which are recorded in books of accounts maintained by assessee : ITAT

++ I-T- Order rejecting approval u/s 80G is valid where the same is cryptic in nature & where it omits to make any reference to Section 80G or rules thereunder : ITAT

++ I-T- The benefit of indexed cost of acquisition is applicable to an assessee while computing capital gain for the purpose of computation of book profit u/s 115JB of the Act: ITAT

++ I-T- Since assessee has filed audit report much after assessee had e-filed Form 10CCB, therefore, claim of deduction ought to have been granted : ITAT

++ I-T- Once the timeline prescribed for filing in Form No.10AB for recognition u/s.12A of the Act, has been extended, same need to be treated as extended for forms viz., Form No.10AB for renewal of approval/recognition/registration under Clause (iii) of first proviso to sub- sec.(5) of Sec.80G of Act: ITAT

June 25, 2024

++ I-T- Settlement applications must contain full and true disclosure of the income supported by documentary evidence; absence of such disclosure is sufficient reason to deny remedy by way of settlement: HC

++ I-T- CBDT's Office Memorandum containing guidelines for deciding Stay Applications, cannot supplant need to probe whether claimant makes out prima facie case for grant of Stay: HC

++ I-T- Re-assessment order invalidated where assessee is given about 24 hours to furnish reply to SCN; CBDT's SOP mandates giving 7 days' time: HC

++ I-T- As per precedent, IBC 2016 prevails over I-T Act 1961; however I-T Department has limited authority to assess tax dues owed by corporate debtor, but cannot suo motu recover dues during moratorium period u/s 14 or 33 of IBC: ITAT

++ I-T- AO cannot probe any issue not listed for investigating in a limited scrutiny; power of revision cannot be exercised where AO does not probe a certain issue which was beyond scope of limited scrutiny: ITAT

June 24, 2024

++ I-T- Writ court's intervention in re-assessment proceedings is unwarranted where assessee could also have raised the relevant arguments in appeal: HC

++ I-T- Activity of shipbuilding qualifies as construction work so as to be eligible for Fringe Benefit Tax under Section 115WE of the Act: ITAT

June 22, 2024

++ I-T- AO cannot travel beyond the mandate, he cannot proceed to make any other additions beyond the reasons recorded to reopen the assessment: ITAT

++ I-T- Provisions of Section 68 place burden on assessee of proving identity, creditworthiness of parties & genuineness of the transaction; assessee must disprove allegations levelled to AO's satisfaction: ITAT

++ I-T-CIT(A) cannot absolve assessee from rigors of Section 68, where assessee does not furnish evidence to prove identity, creditworthiness of parties & genuineness of transaction: ITAT

++ I-T- Furnishing of audit report for claiming a deduction or exemption is mandatory requirement, while mode & stage of filing thereof is a procedural aspect: ITAT

++ I-T- Where requisite audit report is available with AO before assessment order is framed, then claim of deduction cannot be denied to assessee, even if audit report may not have been filed along with ITR: ITAT

June 21, 2024

++ I-T- Re-assessment order cannot be faulted, where assessee does not file reply to Show Cause Notice within timely manner; costs of Rs 5000/- imposed on assessee for delayed filing of replies: HC

++ I-T- Provisions of Section 245 mandate ITAT to hear appeals on merits; cannot dismiss appeal for non-prosecution without considering merits of the case: HC

++ I-T- Assessment order invalidated where passed in name of deceased assessee: ITAT

++ I-T- Unexplained cash credit - additions framed u/s 68 upheld, where assessee omits to furnish evidence to explain nature of transaction or the source of funds found in assessee's possession: ITAT

++ I-T- Bogus purchases - profit element embedded therein be disallowed, rather than disallowing entire quantum of purchases: ITAT

June 20, 2024

++ I-T- Re-assessment order merits being quashed where assessee deserves an opportunity to file reply to Show Cause Notices : HC

++ I-T- Considering principle of natural justice, case can be remanded back to CIT(A) when assessee shows justified reasons for non compliance of notice issued by CIT(A) : ITAT

++ I-T- Appeal is not to be treated as withdrawn till issue of certificate by Designated Authority in Form 5 under Vivaad Se Vishwas Scheme : ITAT

June 18, 2024

++ I-T- Assessment order is invalidated where passed without considering assessee's request for a personal hearing, thereby breaching mandate of Section 144B: HC

++ I-T- Provisions u/s 222(2)(b) of I-Tax Act, the provisional attachment could be extended up to two years or sixty days from date of order of assessment whichever is later: HC

++ I-T- Assessment order is rendered void where assessee was denied opportunity of hearing as well as sufficient time for filing reply to Show Cause Notice: HC

++ I-T- A house constructed without any amenities, cannot be construed as a residential house for availing exemption u/s 54: ITAT

++ I-T- There is no bar on applicant to move application for final registration before period of six months from expiry of provisional registration : ITAT

June 17, 2024

++ I-T- It is necessary to adhere to statutory timeframes laid down for claiming deductions, more so where powers of condonation u/s 119(2) are limited to extraordinary circumstances: HC

++ I-T- Issue of addition for unexplained cash deposits should be remanded as there are several aspects which need examination by AO and filing of details/documents by assessee : ITAT

++ I-T- Deduction can be claimed u/s 80P(2) only if assessee has fulfilled requirement of section 80A(5)/80AC: ITAT

++ I-T- Additions framed u/s 68 not tenable where AO does not furnish evidence to disprove genuineness of transaction involving unsecured loan: ITAT

++ I-T- Cash loans between directors and their companies will not attract penalty u/s 271E where such loans had to be given out of expediency: ITAT

June 15, 2024

++ I-T- Section 153C is only an enabling provision and does not preclude reopening U/s. 148A(b) of the Act: ITAT

June 14, 2024

++ I-T- Re-assessment order is invalidated where passed without considering the assessee's reply to Show Cause Notice and relevant evidence adduced: HC

++ I-T - Summons cannot be assailed u/s 202 of CrPC, where proper inquiry was conducted u/s 202 of CrPC & sufficient grounds for proceeding were made out: HC

++ I-T- AO lacks jurisdiction to substitute NAV method of assessing valuation of shares, once assessee had exercised option of a DCF valuation method as per Rule 11UA(2) of I-T Rules: HC

++ I-T- Long term capital gains on sale of shares is genuine as assessee has submitted requisite details in respect of purchase and sale of shares and same is not disproved : ITAT

++ I-T- No disallowance of expenses on ad hoc basis can be made when books of account and book results has not been rejected by Revenue: ITAT

++ I-T- Additions framed by considering only credit entries in account books, while debit entries were ignored; case remanded for reconsideration: ITAT

June 13, 2024

++ I-T- Assessee is eligible for grant of final registration under Section 80G(5) of Act : ITAT

++ I-T- A ground of appeal against order passed by the AO, can be raised for the first time before ITAT itself, where such ground was not raised before the CIT(A) : ITAT

++ I-T- Object and intention behind CBDT Circular No. 7 of 2024 is not to deprive any institutions of its benefit : ITAT

++ I-T- Since records clearly prove identity, capacity and genuineness of share transactions addition u/s 68 cannot be made : ITAT

++ I-T- Case can be remanded as various sub issues are yet to be decided including whether residential property purchased is ready-to-move-in flat or under-construction flat : ITAT

June 12, 2024

++ I-T- Booking advance converted into unsecured loan to be paid with interest & which is reflected in books seized during Search does not qualify as unexplained money: ITAT

++ I-T- If credit balance is confirmed by sundry creditor and assessee has pay off liability, there remains no scope for bringing credit balance under ambit of cessation of liability u/s 41(1) of Act : ITAT

++ I-T- Depreciation on goodwill arising on account of amalgamation amongst group companies, is allowed in current year, where such benefit is also allowed in preceding year: ITAT

++ I-T- Provision created for investor awareness as per SEBI rules is direct liability of assessee and allowable expenditure : ITAT

June 11, 2024

++ I-T- On-time voluntary payment not arising out of any statutory or contractual obligation would not tantamount to prerequisite under Section 17 (2)(vi) of the Act: HC

++ I-T- Immunity from prosecution granted by SETCOM after filing complaint but before framing of charges; continuation of complaint is gross abuse of process of law: HC

++ I-T- Dismissal of appeal by lower authorities is valid where assessee does not participate in personal hearing; assessee nonetheless given fresh chance to present arguments: HC

++ I-T- In any case, the assessee is eligible to apply for final registration only after the grant of provisional approval: ITAT

++ I-T- Assessee's ground of Audi Alteram Partem does not hold water where assessee skips personal hearing on 6 occasions: ITAT

June 10, 2024

++ I-T- Writ court need not interfere in matter where assessee also has appellate remedy available: HC

++ I-T-As per settled position in law, interest accrued on compensation received can be termed as capital receipt & hence, not taxable: HC

++ I-T- As is trite law , failure of AO to pass draft assessment order u/s 144C, vitiates the final assessment order, due to lack of jurisdiction: ITAT

++ I-T- Additions framed without bringing adverse evidence on record, cannot be sustained: ITAT

June 08, 2024

++ I-T- Re-assessment cannot be resorted to, based on the statements made by a third party in respect of assessee: ITAT

++ I-T- Capital gains arising on sale of shares cannot be regarded as sham profit and consequently, additions under made u/s 68 or section 69A of the Act is not justified: ITAT

++ I-T- Merely because cheques have not been encashed it cannot be said that the transaction is incomplete because assessee has paid stamp duty and registration fees : ITAT

June 07, 2024

++ I-T - Transit rent, akin to hardship allowance is not to be considered as revenue receipt and hence is not liable to TDS deduction: HC

++ I-T- Revenue is not justified in rasing tax on same income in year under consideration, when tax on same has already been taken in another assessment year : ITAT

++ I-T- Assessment orders are void ab initio as CIT(A) has fallen in error to consider firm to be in existence during years under consideration: ITAT

++ I-T- Transfer of excess liability is nothing but a capital transaction which does not warrant the transaction to be routed through Profit and Loss account: ITAT

June 06, 2024

++ I-T- Assessee cannot claim to have been denied personal hearing before passing of order, where assessee himself does not participate in personal hearings or respond to notices: HC

++ I-T- Interest earned by a cooperative bank from investment made in another cooperative bank, is eligible for deduction u/s 80P: ITAT

++ I-T- Since CIT(A) has passed well-reasoned order for cash sales, it does not require any interference: ITAT

++ I-T- If assessee has pool of both interest-free & interest-laden funds, then any advances made to subsidiaries or to family, will be presumed to be made out of interest-free funds: ITAT

++ I-T- AO cannot stand in assessee's shoes to ascertain commercial or other expediency behind grant of advances: ITAT

++ I-T- Additions framed in respect of bogus purchases merits being restricted to the profit element embedded in such purchases: ITAT

++ I-T- Merely because certain amount is payable for last six years that does not mean that there is cessation of liability which can be taxed : ITAT

++ I-T- Additions framed on account of unexplained investments are unsustainable, where no evidence exists to show that the assessee paid any on-money towards an investment: ITAT

June 05, 2024

++ I-T-Writ petition challenging assessment order need not be entertained where assessee also has parallel remedy of statutory appeal: HC

++ I-T-Writ jurisdiction cannot be invoked in respect of an order which is not lacking in jurisdiction or is not prima facie illegal and does not violate the rules of natural justice: HC

++ I-T- Faceless Assessment provisions enacted w.e.f. 01.04.2021 cannot be applied retrospectively: HC

++ I-T- Section 50C of the Act has no application to the sale of the property after its conversion into stock in trade : ITAT

++ I-T- Income from share trading activity is rightly returned as Short Term Capital Gain as assessee has shown all investments in shares under head 'investments' and not as 'stock-in-trade': ITAT

June 04, 2024

++ I-T- Re-assessment cannot be done in respect of company which ceases to exist on account of its amalgamation: HC

++ I-T - Notices issued u/s 148A(b) & 148 are not sustainable as reasons to believe that income escaped assessment is without basis: HC

++ I-T- Addition made on account of unexplained investment u/s 69 of the Act is not justified in cases where source of such deposits have been established by assessee: ITAT

++ I-T- Interest income earned on fixed deposits with cooperative bank or scheduled bank, partakes character of business income & hence is eligible for deduction u/s 80P: ITAT

++ I-T- As per settled precedent, situs of AO is only key factor for ascertaining jurisdiction of Appellate Forum, irrespective of administrative order passed u/s 127 for transfer of cases; ITAT cannot hear matter where it has no jurisdiction over AO concerned: ITAT

June 03, 2024

++ I-T- Re-assessment invalidated where sanctioned by Principal CIT rather than by Principal CCIT who holds mandate to sanction this exercise: HC

++ I-T- Re-assessment invalidated where commenced solely by invoking amended provisions of Section 148A which provide enlarged scope for re-assessment & where no new evidence exists to show escapement of income : HC

++ I-T- As per settled position in law, even a correct order gets nullified if it is passed by the wrong authority who did not have jurisdiction to pass such order: HC

++ I-T- Identical amount received by the co-employee from the same employer shall be treated as salary in advance and allowed the benefit of the provisions under section 89(1) of the Act read with rule 21A(2) of the IT Rules, 1962: ITAT

June 01, 2024

++ I-T- Cash gifts received from close family members cannot be disallowed where sources of income for giving such gifts, are furnished: ITAT

++ I-T- Acceptance of voluntarily surrendered professional receipt of assessee by AO is in accordance with judicial pronouncements and therefore justified : ITAT

++ I-T- A Tribunal is vested with the requisite authority and jurisdiction to admit additional evidence and material in order to do substantial justice to the parties: ITAT

++ I-T- Revenue has erred in re-computing book profit by making additions towards interest income credited to profit and loss account towards waiver of interest by TIIC : ITAT