TODAY'S CASE (DIRECT TAX)

August 31, 2022

++ I-T - Differential amount between purchase price and valuation report as determined by DVO should be brought to tax by AO u/s 56(2)(vii)(b): ITAT

++ I-T - No charitable trust can be characterised as with religious object, especially when it does not make a distinction between caste, creed, race & religion: ITAT

++ I-T - Order of PCIT u/s 263 can be upheld when assessee fails to demonstrate on merits that view taken by AO before passing assessment order is plausible view: ITAT

++ I-T- Issue of land vacation compensation charges is duly examined by AO by making necessary inquiries and is partly allowed by AO by applying his mind : ITAT

++ I-T - Assessee's claim once allowed cannot be revisited, without establishing that there has been some fraud or misrepresentation on part of assessee: ITAT

++ I-T - Revenue cannot enter in shoes of assessee to decide quantum of salary to be paid by employer: ITAT

++ I-T - Valuation of preference shares under discounted free cash flow method is one of recognized methods: ITAT

++ I-T - Agriculture land is not 'asset' for purposes of levying capital gain: ITAT

August 30, 2022

++ I-T- Pecuniary limit fixed for purpose of distribution of work between officers, does not mean inherent lack of jurisdiction of AO to issue notice u/s 148: HC

++ I-T- PCIT can exercise power u/s 263 and set aside assessment order if AO has failed to make correct application of law : ITAT

++ I-T- Since purchase of immovable property is duly explained with documentary evidences, no addition for unexplained investment can be made: ITAT

++ I-T- Merely because credit is outstanding for long time does not lead to conclusion that sundry creditors are not payable : ITAT

++ I-T - Loss incurred on futures and options would have to be construed only as business loss and provisions of Section 73 and its explanation thereon would not come into operation at all: ITAT

August 29, 2022

++ I-T - Assessee is entitled to interest u/s 244A on shortfall amount that assessee did not receive over and above that was computed by CPC vide intimation u/s 143(1): ITAT

++ I-T - Reopening of assessment can't be allowed in mechanical manner and without application of mind by authority : ITAT

++ I-T - Exemption u/s 11 merits to be denied if assessee's activities are hit by proviso to section 2(15): ITAT

++ I-T - No addition u/s 68 can be made if transactions are duly supported by documentary evidence produced by assessee : ITAT

++ I-T - Claim of depreciation on securities can be allowed as conversion of securities resulted in depreciation of value : ITAT

August 27, 2022

++ I-T - Revisionary Powers u/s 263 cannot be permitted to be exercised on suspicions and inferences: ITAT

++ I-T - Assessee is free to make investment in residential property anywhere, for purpose of claiming benefit of Section 54F: ITAT

++ I-T - AO has no power to revise assessment on mere change of opinion: ITAT

August 26, 2022

++ I-T - Mere provision for bad debt per se is not entitled to deduction u/s 36(1)(vii): SC LB

++ I-T - Preemptive assessments made against companies whose name were stuck off by Registrar of Companies, for statutory defaults under Companies Act, can't be set aside on Jurisdictional defect: ITAT

++ I-T- Since assessee is non- government public limited company not listed in Stock market, there is no need to calculate remuneration as per sec 197 of Companies Act : ITAT

++ I-T- Since there is no provision of section 56(2)(viib) in statute at time of receiving share application money in FY 2010-11, this provision cannot be applied : ITAT

++ I-T- Case can be remanded for reconsideration as fresh registration has been granted u/s 12AA of Act for AY 2022-23 to AY 2026-2027 to assessee - YES : ITAT

++ I-T- Deduction of profits form housing project u/s 80IB(10) cannot be allowed if assessee does not make claim in revised return filed : ITAT

++ I-T- Once net profit is estimated, there cannot be further addition made on account of interest on loans advanced : ITAT

++ I-T - No addition made u/s 68 on basis of suspicion and preponderance of probability, cannot be sustained: ITAT

++ I-T- If basis of proceeding is gone, action taken thereon would fall also : ITAT

August 25, 2022

++ I-T - Bonafide mistake committed by assessee inadvertently in not adding back loss on sale of fixed assets in computation of income, does not amount to furnishing of inaccurate particulars: ITAT

++ I-T- Section 43B is attracted even though assessee has not routed Sales Tax/Works Contract Tax liability through P&L Account but has claimed same: ITAT

++ I-T - Since order of assessment is passed without jurisdiction beyond limitation period, issue raised can stand allowed in favour of assessee: ITAT

++ I-T - If identity & genuineness of transaction is not in dispute, there is no reason to treat alleged share application money as unexplained: ITAT

++ I-T - Actual write off of provision for bad debts, would not be hit by clause (i) of Explanation to Section 115JB: ITAT

++ I-T - PCIT has erred in assuming revision jurisdiction u/s 263 as it is based on mistaken premise of facts: ITAT

++ I-T - No TDS liability is attached on payments which are actually in nature of reimbursement: ITAT

++ I-T- Depreciation @ 10% can be allowed on whole of consideration towards FSI: ITAT

August 24, 2022

++ I-T - AO had jurisdiction to reassess other issues in respect of which proceedings u/s 147 were initiated but he was not justified if reasons for initiation of those proceedings ceased to survive: ITAT

++ I-T - No addition is permitted on basis of notional valuation, if in books of account any expenditure corresponding to additional amount of construction of WIP is not found debited: ITAT

++ I-T - Revisionary order would not be sustainable in eyes of law, if power u/s 263 was exercised without evaluating material available on record: ITAT

++ I-T - Mere fact that payment has been made through normal banking channel is not enough to establish genuineness of transaction: ITAT

++ I-T - Employees' contribution paid before due date of filing of return of income u/s 139(1) is allowable deduction u/s 43B: ITAT

++ I-T - Failure to draw panchnama after conclusion of search, renders assumption of jurisdiction u/s 153A as invaid: ITAT

++ I-T- Books of accounts are rightly rejected in view of defect/deficiencies pointed out by AO in same : ITAT

August 23, 2022

++ Benami Act - Sec 3 r/w/s 2(a) & Sec 5 of Benami Transactions (Prohibition) Act, 1988, being disproportionately harsh, were unconstitutional from their inception: SC LB

++ I-T - Search assessment proceedings cannot be sustained where no material incriminating the assessee is found in course of search operations : HC

++ I-T - A particular expenditure which has consistently been allowed in past AYs must also be allowed in the current AY in keeping with the rule of consistency: HC

++ I-T - If asset realized without approval of DSIR are sold, then sales realization arising there from are to be set off against R&D expenditure which is claimed as deduction u/s 35(2AB): ITAT

++ I-T - If AO has agreed and taken one of possible view, then Pr CIT cannot impose his another possible view: ITAT

++ I-T - It cannot be concluded that business has been set up, merely on basis of incorporation of company: ITAT

++ I-T- Income of non-resident is not chargeable u/s 5(2) and sec 69A cannot override Section 5(2): ITAT

++ I-T - Reopening merely on basis of change of opinion is not permitted: ITAT

August 22, 2022

++ I-T - Power of transfer exercisable u/s 127 is relatable only to jurisdiction of Income Tax Authorities: SC LB

++ I-T - Accounting methodology consistently adopted by assessee to recognize revenue under securitization transactions, if in line with prudential norms prescribed by RBI, should not be disregarded: ITAT

++ I-T - Failure of AO to deal with objection raised by assessee before him and passing summary order, merits to be quashed: ITAT

++ I-T - Bogus sales promotion expenses which are not recorded in books of account, merits complete disallowance: ITAT

++ I-T- Addition u/s 68 can not be made when assessee has discharged onus placed upon it in respect of cash credit : ITAT

++ I-T- Income from sale of shares held as 'investment' has to be treated as capital gain and not business income: ITAT

++ I-T - For availing benefit of deduction u/s 54F, new asset shall be purchased in name of assessee: ITAT

++ I-T- Additional evidences filed by the assessee in office of CIT(A) deserve to be admitted : ITAT

++ I-T- Claim for depreciation on electrical installation @ 15% can be allowed :ITAT

August 20, 2022

++ I-T - Practise of I-T Dept in acting contrary to their sworn affidavit should be deprecated, as statement of witnesses were used against assessee without affording cross-examination of those witnesses: HC

++ I-T - Power of revision cannot be exercised solely because PCIT disagrees with view taken by AO in original assessment order: ITAT

++ I-T - Once AO has accepted gross sales & license fee reflected by assessee in its ledger account, he cannot deny benefit of payment of License Fee which was reduced from gross sales by assessee: ITAT

August 19, 2022

++ I-T - Just because payments had been made by developer, doctrine of mutuality cannot be taken away from cooperative housing society: ITAT

++ I-T - If Development Fee is directly taken to corpus account as capital receipt u/s 11(1)(d) and is also invested in fixed asset, then such fee has to be treated as corpus fund: ITAT

++ I-T - Addition made can be deleted by following decision of Tribunal on identical situation in case of husband of assessee : ITAT

++ I-T - Merely based on report of Investigation Wing, without specific material, addition can be made for unexplained expenditure u/s 69: ITAT

++ I-T - Reassessment proceedings are invalid as based on reconsideration of same facts which prevailed during course of original assessment : ITAT

++ I-T - Income of individual investor from sale of shares on routine basis, has to be treated as capital gains and not business income: ITAT

++ I-T - Revision u/s 263 can be carried out only if assessment order is erroneous or prejudicial to interest of Revenue: ITAT

August 18, 2022

++ I-T - Every business activity has some inherent peculiarities and same needs to be appreciated without much emphasis on evidence of every thing being incorporated in agreements: ITAT

++ I-T - For purpose of Sec 115J, assessee can claim depreciation at rates provided under Income-tax Rules and need not adopt rates prescribed under Companies Act : ITAT

++ I-T - Assessee is entitled for deduction against profit estimated by AO of such expenses being interest on partners' capital account and remuneration to partners : ITAT

++ I-T - Admission made by buyer of property before Settlement Commission does not establish fact that assessee has received unaccounted consideration : ITAT

++ I-T - No enquiry and non-application of mind by AO while carrying out assessment, calls for revisional interference u/s 263: ITAT

++ I-T - Merely collection of fee for training programmes cannot make an autonomous institution commercial : ITAT

++ I-T - In absence of any evidence placed by Revenue to demonstrate that payment is bogus in nature, no disallowance of expenses can be made: ITAT

August 17, 2022

++ I-T - Advance given to shareholder as consequence of any further consideration which is beneficial to donor-company, is not deemed dividend : ITAT

++ I-T - Quantum of investment made in purchase of residential units merits to be verified before granting deduction u/s 54F: ITAT

++ I-T - Cash loan taken from parents and spouse cannot be brought under ambit of Section 269SS when assessee has shown no obligation to repay such amount: ITAT

++ I-T - If scheme of Section 12A does not visualize conditions being part of scheme of registration being granted to charitable trust, Commissioner cannot supplement law by laying down such condition either: ITAT

++ I-T- Costs directly pertaining to Indian business is not subject to Sec 44C: ITAT

++ I-T - Repayment of loan/deposit through general entries is in contravention of section 269T: ITAT

August 16, 2022

++ I-T - Expenditure incurred for beautification of leased outlets, is revenue in nature: HC

++ I-T - Order passed by Magistrate discharging accused of all allegations in complaint filed u/s 200 of CrPC, is challengeable only under revisional provisions of Section 397(1) of CrPC: HC

++ I-T- Term 'member' include nominal members and addition u/s 40(a)(ia) can not be made for non-deduction of TDS on interest paid on deposit received from nominal members of society: ITAT

++ I-T - Rejection of revised returns of income can be rejected straightaway when assessee had inadvertently made errors in computation of income therein : ITAT

++ I-T- Decision of CIT(A) that 'no search was conducted' on assessee and summarily nullifying proceedings u/s 153A as 'ex-facie illegal' is devoid of merit : ITAT

++ I-T- Waiver of loan amounts to cessation of liability other than trading liability and section 28(iv) of Act does not apply : ITAT

++ I-T - Receipts from sale of carbon credits, which is generated due to environmerntal concern, is a capital receipt: ITAT

++ I-T- CAM charges paid is liable for deduction of tax at source @ 2% u/s 194C of Act: ITAT

August 13, 2022

++ I-T- On issue of advances from customers, order passed by PCIT u/s 263 is barred by limitation : ITAT

++ I-T- On failure of assessee to demonstrate that required TDS is deducted and deposited with appropriate authorities, addition u/s 40(a)(ia) is rightly upheld by CIT(A) : ITAT

++ I-T - Fact that taxpayer deducted tax at source on commission payment, does not satisfy requirement of reasonableness of expenditure qua services alleged to be received by him: ITAT

August 12, 2022

++ I-T - Following order passed by Co- ordinate Bench of Tribunal on identical issue, addition made by rejecting claim of deduction u/s 10(38) can be removed : ITAT

++ I-T - Benefit of sections 11 & 12 can be given in respect of income derived in any AY preceding to year in which registration u/s 12A is granted if for that AY proceedings are pending : ITAT

++ I-T- Affidavit filed by assessee is only self serving document and no weight can be attached to it in absence of any other material submitted to support claim of cost of improvement : ITAT

++ I-T - Revisionary power cannot be exercised where original order not established as being erroneous or prejudicial to revenue's interests: ITAT

++ I-T- Assessment u/s 143(3) is bad in law if AO issue notice u/s 143(2) in name of company not in existence : ITAT

++ I-T - Order passed hastily without allowing enough opportunity to assessee & noticees u/s 133(6) is not sustainable: ITAT

++ I-T- Delay in preferring appeal can be condoned in interest of justice, when there is no gross negligence or deliberate inaction or lack of bona fides : ITAT

August 11, 2022

++ I-T - Lack of enquiry by AO during course of assessment proceeding, renders such assessment order erroneous & prejudicial to interest of Revenue, warranting revisionary interference: ITAT

++ I-T - Accounting standard followed by assessee for apportionment of expenses between 10A units and non-10A units cannot be faulted, without bringing on record any adverse material: ITAT

++ I-T - Once insolvency proceedings commence, all litigation is to be pursued by Resolution Professional appointed by Committee of Creditors & not by insolvent company : ITAT

++ I-T - In absence of contrary proved by Revenue and following order passed by Tribunal in previous year in assessee's own case, administrative service charges can be allowed :ITAT

++ I-T - Actual sale deed merits to be considered for purpose of ascertaining capital gain u/s 50C: ITAT

++ I-T - No tax is required to be withheld in respect of any payment which is reimbursement of expenditure: ITAT

++ I-T - Payment made for subscription services and use of software can be allowed as Revenue Expenditure : ITAT

++ I-T - If no incriminating material was unearthed during search, no additions can be made to income already assessed: ITAT

August 10, 2022

++ I-T - Ee-assessment order merits being set aside where both re-assessment notice u/s 148 and order passed u/s 148A are passed on the same day: HC

++ I-T - Commission retained by credit card company is not commission as per Sec 194H of I-T Act; disallowance u/s 40(a)(ia) uncalled for: ITAT

++ I-T - Power of revision is rightly invoked where assessment order is erroneous & prejudicial to Revenue's interest, since AO omitted to verify veracity of cash introduced as capital by assessee : ITAT

August 09, 2022

++ I-T - Following order passed by co-ordinate bench of Court on identical issue in assessee's own case, disallowance made for interest u/s 36(1)(iii) can be removed: HC

++ I-T - Re-assessment not tenable where based on allegation of assessee having made purchases from non filers of ITR but where details of these non filers are not given : HC

++ I-T - To claim bad debts, assessee has to write-off same in his Books of accounts and he is not required to prove that debt is irrecoverable : HC

++ I-T - Penalty u/s 271(1)(c) not tenable for any inadvertent error made by assessee & where no deliberate attempt to conceal particulars of income or furnish inaccurate particulars is established : ITAT

++ I-T - Case of assessee has been selected for limited scrutiny, then Pr.CIT cannot enlarge scope of said assessment: ITAT

++ I-T - Right to collect tax fees qualifies as a commercial right which would attract depreciation @ 25% : ITAT

August 08, 2022

++ I-T - Recovery of demand from company directors cannot be resorted to where no satisfaction is recorded about tax not being recoverable from company: HC

++ I-T - Refund payable to an assessee cannot be withheld solely because notice u/s 143(2) has been passed & where no valid reason is given: HC

++ I-T - Transfer of assessment is invalid where assessee is not given personal hearing before transfer : HC

++ I-T - Disallowance of payment on grounds of unexplained gift is upheld where intention to gift money is not clearly established due to entire transaction not being through banking channels : HC

++ I-T - Words 'a one residential' mentioned in Section 54 refers to only one house which can be purchased or constructed and can not be interpreted as 'more than one house' : ITAT

++ I-T - Assessee is not required to deduct TDS at time of payment of EDC to HUDA : ITAT

++ I-T - Amended provisions of Section 54F do not have retrospective effect: ITAT

August 06, 2022

++ I-T- Where assessee neither claims deduction u/s 80IA(4)(v) in original return filed nor filed relevant tax audit report then will not get deduction u/s 80IA(4)(v) even if claimed in revised return : ITAT

++ I-T - Not striking off irrelevant matter in notice can vitiate penalty proceedings : ITAT

++ I-T- Penalty can't be validily imposed without reference to any specific limb of section 27(1)(c) on basis of which penalty is being imposed : ITAT

August 05, 2022

++ I-T - SETCOM's order of rejection of settlement application is to be quashed where mandatory personal hearing u/s 245D(4) was not granted to applicant: HC

++ I-T - SETCOM cannot rely on further report by AO without further opportunity to assessee on ground that matter is time-barring shortly: HC

++ I-T - Once bonafide business decision is taken to write off some debt as bad debt in books, it should be sufficient to allow such claim of assessee: HC

++ I-T - Assessments u/s 153A can be framed not only on basis of incriminating materials found during course of search, but also on basis of material available at time of original assessment: HC

++ I-T- Addition on account of difference in contractual receipts can't be made if assessee has substantiated its explanation by producing copy of its ledger account and other evidences : ITAT

++ I-T- AO makes error by referring matter to DVO without rejecting books of account and addition made on basis of DVO report cannot sustain : ITAT

August 04, 2022

++ I-T - Penalty notice u/s 271(1)(c) is invalid where it omits to specify exact charge against assessee, between concealment of particulars of income & furnishing inaccurate particulars thereof: HC

++ I-T - Reopening is permitted if AO has reason to believe that income chargeable to tax has escaped assessment: HC

++ I-T - Failure to afford opportunity of personal hearing and non-compliance of prescribed procedure laid down as per section 144B for faceless assessment, renders assessment order bad in law: HC

++ I-T - Proceeds received by Trust from building rented out by it cannot be deemed to be sale consideration & be grounds for denial of exemption u/s 11: ITAT

++ I-T - Re-opening of assessment beyond four-year limitation period is sustainable where no failure to make full & true disclosure of facts is attributed to assessee: ITAT

++ I-T - Unexplained cash credit - additions u/s 68 quashed where assessee establishes source of funds in bank a/c: ITAT

August 03, 2022

++ I-T- Nomenclature of disclosing voluntary contribution in returns and forms prescribed under foreign contribution regulation act will not be determinative of nature of donation: ITAT

++ I-T - Since information received only from internal source, case of assessee is covered by tax effect Circular No. 03 of 2018 dated July 11, 2018 and not fall in exceptions : ITAT

++ I-T - Default, if any, is on account of ambiguity which arises out of direction contained in statutory document, so no penalty can be imposed u/s 271C: ITAT

++ I-T - Assessee AOP as non profit trade union is entitled for exemption u/s 10(24) as PCIT has failed to establish that it is business entity : ITAT

++ I-T - Since investment in mutual fund is not business activity of assessee, interest corresponding to such investment can be disallowed : ITAT

++ I-T - Where AO examined claim and takes plausible view, assessment order cannot be termed as erroneous : ITAT

++ I-T- Compensation paid to trust in lieu of benefit availed by specified persons and rent paid by specified person is adequate : ITAT

++ I-T - Suspicions of PCIT cannot be basis for setting aside validly passed assessment order : ITAT

August 02, 2022

++ I-T - No TDS liability is warranted on payments of External Development Charges made to HUDA, as same is not out of any contractual liability: ITAT

++ I-T - Only percentage of profit embedded in amount of contractual receipts can be brought to tax: ITAT

++ I-T - If quantum proceedings itself stands quashed, then non compliance on part of assessee to respond to notice issued u/s 142(1) which void ab inito does not attract penalty u/s 271(1)(b): ITAT

++ I-T - Final assessment order quashed where it is passed without considering assessee's objections to draft order & without allowing personal hearing to assessee: ITAT

++ I-T - Depreciation cannot be allowed in respect of vehicles owned by sister unit of assessee, where assessee is unable to establish ownership over the same : ITAT

August 01, 2022

++ I-T - Search assessment not tenable if no material evidence to incriminate assessee is recovered in search: HC

++ I-T - Adjustment of tax refund payable for one AY, against duty demand raised for another AY is sustainable, where no prior intimation was given to assessee about it: HC

++ I-T - Re-assessment entity issued to amalgamated entity with ceased to exist individually, is invalid: HC

++ I-T - Re-assessment is unsustainable where reasons recorded are copied from reasons recorded for re-assessment of earlier AYs : HC

++ I-T - Power of revision cannot be exercised where CIT has difference of opinion with AO in respect of whether or not to impose penalty on assessee: ITAT

++ I-T- CIT (A) has to pass speaking order in writing as to his decision as to admission or refusal to admit additional evidences: ITAT

++ I-T - If net consideration from sale of property is fully invested in new asset, then whole capital gain should not be charged u/s 45: ITAT

++ I-T - Set-off of brought forward business losses not allowed when sole idea behind scheme of amalgamation is only to avail set-off of brought forward business losses : ITAT