TODAY'S CASE (DIRECT TAX)

January 31, 2022

++ I-T - Notice and proceedings held subsequent thereto against dead person is nullity: HC

++ I-T - Non-satisfaction of reason to believe would by itself make reopening notice fatal: HC

++ I-T - Change of opinion constitute justification and/or reasons to believe that income chargeable to tax has escaped assessment: HC

++ I-T - Assessment order need not contain discussion in respect of every query raised during assessment: HC

++ I-T - Writ petition not maintainable where petitioner concurrently invokes appellate remedy: HC

++ I-T- Alternate writ remedy cannot be availed by taxpayer without availing statutory appeal first: HC

January 29, 2022

++ I-T - If amounts of employees' contribution to ESI & PF stood paid before due date of filing of return, then employer is eligible to claim allowance u/s 36(1)(va): ITAT

++ I-T - If share of employee's contribution is made on or before due date for furnishing return u/s 139(1), then employer is entitled to claim deduction u/s 36(1)(va): ITAT

++ I-T - U/s 148, AO cannot reopen concluded assessment on re-appraisal of same material available before AO during original assessment proceedings : ITAT

January 28, 2022

++ I-T - Mere receipt of information from any source would not by itself tantamount to reason to believe that income chargeable to tax has escaped assessment: ITAT

++ I-T - Disallowance has to be restricted to tune of 30% in respect of expenses on which TDS was not deducted by assessee: ITAT

++ I-T - Issue of disallowance u/s 14A & Rule 8D, cannot be rectified in proceedings initiated u/s 154 being debatable issue: ITAT

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

January 27, 2022

++ I-T - Re-assessment cannot be commenced on the basis of information which was already considered by the AO during original assessment : HC

++ I-T - Revenue authorities can only initiate reassessment proceeding in accordance with substituted law in absence of any saving clause, to save pre-existing provisions: HC

++ I-T - Final assessment order merits being set aside where passed without considering the assessee's objections to the draft assessment order : HC

++ I-T - Additions framed by the AO are sustainable where based solely on statements of an individual & which are not corroborated by any material evidence: HC

++ I-T - If provision for gratuity is not debited in P&L A/c and was disallowed by assessee itself while filing of return, then its disallowance by CPC will result in double taxation: ITAT

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

++ I-T - In absence of any compelling changed circumstances, consistent view taken in assessee's own case for earlier years are not be disturbed: ITAT

January 25, 2022

++ I-T - Assessment order merits being quashed where assessee is unable to opt for personal hearing due to assessee having selected incorrect options on I-T portal for faceless assessment: HC

++ I-T - Suggestion of particular inference by assessee which did not found favour by AO upon reconsideration, is no justifiable ground to hold non-disclosure of primary facts, to initiate reopening: HC

++ I-T - Guidance value of land is appropriate mode to determine full value of consideration in case of transfer, if consideration for transfer of capital asset is not attributable: HC

++ I-T - In case of married woman, 500 gm is the threshold limit of jewellery, source of which shall be presumed to have been explained : ITAT

++ I-T - Registration granted u/s 12AA to an entity under one PAN No. continues even when entity gains new PAN No. due to loss of earlier PAN No. : ITAT

++ I-T - U/s 201(1), onus is upon assessee to furnish CA certificates that payee has paid necessary taxes on income credited by assessee : ITAT

January 24, 2022

++ I-T - Assessment order merits being quashed where assessee is given less than 24 hours to file reply to SCN : HC

++ I-T - Pendency of appeal as provided u/s 2 of DTVsV Act, 2020, has to be rationally considered to be pending, even if appeal is pending along with delay condonation application: HC

++ I-T - Re-assessment is unsustainable where based solely on change of opinion on part of AO: HC

++ I-T - Reliance Industries is held ineligible for benefit of DTVsV Scheme, since prosecution instituted against it under IPC & PC Act casts shadow on monies sought to be offered to tax: HC

++ I-T - If time for filing appeals against order of CIT(A) had not expired as on date of filing declaration, then rejection of such declaration under DTVSV Act is not justified: HC

++ I-T - Non-application of mind by AO in framing assessment order, calls for invocation of revisionary jurisdiction by Pr.CIT u/s 263: ITAT

++ I-T - Department should have not pressed any appeal in view of CBDT Instruction if tax effect in said appeal is less than amount of Rs 50 lakhs: ITAT

January 22, 2022

++ I-T - Faceless assessment order merits being quashed where passed before time specified for passing such order: HC

++ I-T- Revenue's appeal can be dismissed based on findings of Coordinate Benches where, filings and acceptance of MBDL's petition before Settlement Commission and addition has been deleted : ITAT

++ I-T - Delay caused in registration of sale deed due to sheer number of sellers, is insufficient grounds to classify proceeds from sale as LTCG: ITAT

++ I-T- There can't be disallowance of expenses u/s 14A in excess of exempt income : ITAT

++ I-T- No need to disallow expenditure as genuineness is not in dispute and assessee in subsequent AYs has shown income from operation :ITAT

January 21, 2022

++ I-T - Effort of taxpayer in attempting to invite different conclusion from writ court in respect of very same A.Y in which weighted deduction was denied, is not permissible: HC

++ I-T - Re-assessment proceedings sustained where reasons thereto are clearly spelt out & leave no room for conjecture or surmise: ITAT

++ I-T - Interest paid by assessee partner on excess withdrawals from partnership firm can be allowed while computing the taxable income of a partner of firm: ITAT

++ I-T - Deposit of employees's contribution towards ESI and PF paid before due date of filing of return can be allowed for AY 2018-19 : ITAT

++ I-T - Allotment letter, title paper, possession letters and no due certificate submitted by assessee cannot be rejected by Revenue without assigning any cogent reasons: ITAT

++ I-T- Where two views are possible and AO has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order: ITAT

++ I-T - Additions on grounds of bogus expenses are not tenable if Revenue omits to prove that these expenses were incurred at all: ITAT

++ I-T - In terms of CBDT Circular No. 133 of 2007 dated 9.5.2007 Delhi Co-op Urban Thrift and Credit Society Ltd. is not a cooperative bank : ITAT

January 20, 2022

++ I-T - Provisions of Sec 47(iv) are inapplicable on transaction of redemption of preference shares: HC

++ I-T - If on consideration of material on record a conclusive view is taken, then AO cannot take different view based on same material: HC

++ I-T - Offering income to tax under incorrect heading, while being under bona fide belief of its correctness, is no ground for imposing penalty for concealment of income: ITAT

++ I-T - Employees' contribution to PF & ESI cannot be disallowed where such payment is made before the due date for filing ITR : ITAT

++ I-T - No omission to make full & true disclosure of material facts; re-assessment untenable: ITAT

++ I-T - Amended provisions of Sections 36(1)(va) & 43B cannot be invoked retrospectively: ITAT

January 19, 2022

++ I-T - Sec 147 requires assessee to make full & true disclosure of primary facts necessary for assessment & nothing beyond: HC

++ I-T - Additions framed u/s 68 are rightly quashed where creditworthiness of lenders is established: ITAT

++ I-T - 636-day delay in filing appeal before CIT (A) cannot be condoned where such delay is attributable to negligent conduct on part of the assessee : ITAT

++ I-T- Trading addition can't be made when AO checked books and manufacturing records and no defect is pointed out : ITAT

++ I-T - Since whole of jewellery received by assessee and his wife is duly explained with documents, addition of jewellery can be deleted : ITAT

January 18, 2022

++ I-T - Re-opening assessment is not tenable where based on change of opinion & if primary facts are disclosed in original assessment: HC

++ I-T - Re-assessment is unsustainable where based solely on inputs received from Investigation Wing: HC

++ I-T - Certain income cannot be re-classified independently once AO accepts assessee's objections in respect of same income during re-assessment: HC

++ I-T - Solely on basis of declaration made during survey no penalty can be imposed u/s 271(1)(c) read with Explanation 5A: ITAT

++ I-T - Illness of Managing Trustee of a trust qualifies as reasonable cause provided under Sec 273B for not filing ITR within due date : ITAT

January 17, 2022

++ I-T - Delhi HC issued notice on matter of quashing of criminal complaint for offences u/s 277 of Income tax Act r/w/s 181/191/193 of IPC, which is pending before Tis Hazari Courts: HC

++ I-T - If licence fee is for operation and usage of right given under licence and has not result in creation of capital asset or advantage, it can be treated as Revenue Expenditure : ITAT

++ I-T - CIT (A) has rightly restricted addition of sundry creditors as assessee has established genuineness of sundry creditors and reconciled amounts with details to certain extent :ITAT

++ I-T - Matter cannot be remitted for a fresh decision to the AO to conduct further inquiries without a finding that assessment order is erroneous :ITAT

++ I-T - Interest cost cannot be allowed as Revenue Expenditure and it has to be capitalized if it is incurred in connection with the capital asset: ITAT

++ I-T - Payment towards Employees' contribution to PF & ESI cannot be disallowed where made before due date of filing ITR: ITAT

++ I-T - Since land is held as current asset, sec 2(47)(v) is not applicable and no addition for capital gains can be made: ITAT

++ I-T - Disallowance of claim of Standard/Non-Standard NPS assets is per se insufficient ground to impose penalty u/s 271(1)(c) : ITAT

January 15, 2022

++ I-T - Converting debentures out of debit balance with sister unit cannot be treated as diversion of funds to the sister concern out of interest bearing funds: ITAT

++ I-T - Disallowance of payments towards employees' contribution to ESI & PF need not be disallowed where such payments are made before due date of filing ITR: ITAT

++ I-T - Employee's contribution to PF & ESI cannot be disallowed where paid before due date of filing ITR: ITAT

January 14, 2022

++ I-T- Merely because accounts are audited post grant of registration u/s 12AA would not 'ipso facto' vitiate authenticity of accounts so furnished : ITAT

++ I-T - There is substance in assessee's claim of having received part sale consideration qua sale of properties and same is wrongly rejected by lower authorities : ITAT

++ I-T - Since PCIT failed to point out any error in AO's order, revisionary power exercised is not sustainable in law : ITAT

++ I-T- Case can be remanded as it is necessary to first address facts and there is no finding on nature of penal interest : ITAT

++ I-T- Penalty cannot be levied when there is no deliberate act on part of assessee to furnish inaccurate particulars of income : ITAT

January 13, 2022

++ I-T- Since hostel facilities provided by educational institution is intrinsic part of 'educational activities', same comes under charitable purpose which is exempt u/s 11: ITAT

++ I-T - In absence of satisfaction recorded and handing over of seized material by AO of searched person, AO cannot by himself invoke provisions u/s 153C : ITAT

++ I-T- Revision proceedings cannot be initiated if AO has passed order after carrying out inquiries which a reasonable and prudent officer would have carried out: ITAT

++ I-T - Since AO has made addition without giving a proper opportunity for cross examination, same is bad in law : ITAT

++ I-T - Commission paid to overseas agent can be allowed as it is paid for business consideration : ITAT

++ I-T- CIT(E) is well within jurisdiction to examine claim of no activity: ITAT

January 12, 2022

++ I-T - AO failed to appreciate evidence in the form of impounded documents & CDs, which are admissible as evidence as per Section 65B of Evidence Act; additions framed unsustainable: HC

++ I-T- Since AO has allowed claim for deduction u/s 54B after due verification and examination, Pr.CIT is not justified in exercising power of revision u/s 263 of the Act : ITAT

++ I-T - Reopening of assessment u/s 147 is bad in law when AO proceeds to make opinion on basis of borrowed reasons and there is no independent application of mind : ITAT

++ I-T - PCIT cannot initiate revision proceedings u/s 263 by terming AO's view as erroneous : ITAT

++ I-T - Provisions of Sec 43B impose liability on assessee; not applicable with retro effect unless explicitly stated by Legislature: ITAT

++ I-T - Loss incurred by assessee on account of foreign exchange fluctuation is allowable as revenue expenditure : ITAT

++ I-T- Decision of CIT(A) regarding rate of commission need not be changed as passed after considering material very carefully : ITAT

January 11, 2022

++ I-T - Assessee being engaged in treatment of ailing spouse was unable to furnish documents in response to notice u/s 142(1) - sufficient cause made out for re-consideration: HC

++ I-T - PCIT is not justified in exercising revisionary powers in respect of issue which is already enquired by AO and no material on record shows that there is error in assessment order : ITAT

++ I-T - Simply on the basis of assumption, no addition can be made regarding commission payment made to liaison representatives for procuring orders: ITAT

++ I-T - Provisions of Sec 50C would not stand triggered in respect of transfer of reversionary rights of property: ITAT

++ I-T - Generic notice betrays application of mind and penalty levied is not legally sustainable : ITAT

++ I-T - Assessee is not 'assessee' in default' on the basis that TDS is not deducted on LFC paid by referring to original statement and not correction statements: ITAT

January 10, 2022

++ I-T - Final orders are unsustainable where SCN or draft order as per Sec 144B are not issued: HC

++ I-T - Revenue cannot be held at fault for not considering an assessee's objections to re-assessment, where assessee fails to promptly raise its objections: HC

++ I-T - Once excess stock has been debited in P&L Account then unsold stock as on 31st March 2015 also forms part of closing stock which is to be valued as per method regularly adopted by assessee : ITAT

++ I-T - Reopeing of assessment and addition made is valid as assessee fails to prove the facts which are especially within his notice and knowledge and failed to discharge his onus : ITAT

++ I-T - Even if assessee has been consistently allowed deduction u/s 80IC, lower authorities can modify quantum of profits disclosed by assessee : ITAT

++ I-T - Agri land in rural area qualifies as capital asset - proceeds from its sale not taxable as capital gains: ITAT

January 08, 2022

++ I-T - Capital gain cannot be treated as income from other sources without disputing genuineness of evidences placed on record : ITAT

++ I-T- Since additional depreciation is a one-time benefit to encourage industrialization, therefore, beneficial provision has to be construed reasonably, liberally and purposively : ITAT

January 07, 2022

++ I-T- When there is no satisfaction recorded in case by AO of searched persons, assessment u/s 153C in case of other person cannot be upheld : ITAT

++ I-T - Assessee cannot be allowed deduction u/s 80P(2)(a)(i) if it does not fulfill conditions contained in Sec 80A(5): ITAT

++ I-T - No addition on account of deemed rental income can be made in respect of unsold stock of flats held as 'stock in trade' upto AY 2017-18 : ITAT

++ I-T - Since AO has verified issue and by application of mind passed assessment order, PCIT is not justified in exercising revisionary jurisdiction: ITAT

++ I-T - If assessee has already admitted sales as revenue receipt then there is no case for making the addition u/s 68 or tax the same u/s 115BBE again : ITAT

++ I-T - AO is not obliged to proceed u/s 147 on basis of directions issued by his higher authority which would otherwise amount to borrowed satisfaction: ITAT

++ I-T - If assessee complies with provisions of deposit in capital gain scheme account then amount so deposited is deemed to be cost of new asset and deduction u/s 54F has to be allowed : ITAT

++ I-T - If there is no evidence to establish that client code modification has resulted in shifting of profit and assessee has received back equivalent monetary benefits, then no addition is permitted: ITAT

January 06, 2022

++ I-T - Benefit neither claimed in original nor revised return by the assessee, cannot be allowed to be carried forward for set off: ITAT

++ I-T - CIT (Exemption) should take cognizance of evidence and decide application u/s 12AA of applicant trust as per law: ITAT

++ I-T - There is no reason to invoke provisions of sec 68 merely because there was an increase in list of creditors: ITAT

++ I-T - Amount received as premium against grant of tenancy right cannot be considered as income from house property: ITAT

++ I-T - Order of Pr CIT u/s 263 is not valid as passed beyond time period prescribed in law: ITAT

++ I-T - Re-assessment cannot be resorted to based solely on information sourced from Investigation Wing & without independent analysis of such information by AO: ITAT

January 05, 2022

++ I-T- Non-filing of audit report electronically cannot be the reason for imposing penalty u/s 271B of the Act : ITAT

++ I-T - Additions framed in respect of employee's contribution to ESI & PF merit being quashed where such payment is made before due date of filing ITRs : ITAT

++ I-T - Amendment made in Income tax Act for certain compliance u/s 35(2AB) should be made prospectively: ITAT

++ I-T- Issuance of notice u/s 153C and related assessment is not valid as satisfaction note recorded by AO does not mention or is based on any seized material belonging to assessee company :ITAT

++ I -T - Loss suffered by Assessee Company is on account of valuation of inventory and not trading loss or a capital loss, therefore addition made u/s 68 by treating short-term capital loss as unexplained cash credit is not sustainable: ITAT

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

++ I-T- ESOP discount being difference between market value of shares and value at which employees are given shares is allowed u/s 37 of Act : ITAT

January 04, 2022

++ I -T - Sanction for re-assessment will be said to have been given without application of mind where there are three sets of reasons recorded & their authors cannot ascertained : HC

++ I-T - Order for sanctioning criminal prosecution need not contain detailed reasons but must highlight facts constituting offence & reasons for the same must be stated: HC

++ I-T - Re-assessment is unsustainable where approval is mechanically granted without probing as to whether there actually was lapse on assessee's part in making full & true disclosure of relevant facts : HC

++ I-T - Assessee is entitled to interest on refund where delay in disbursal of refund is not attributable to assessee: HC

++ I-T- PCIT rightly set aside assessment order u/s 263 as assessee did not file any valuation report to substantiate fair market value of shares issued in terms of Sec 56(2)(viib)(a)(i) and AO should have examine this aspect : ITAT

++ I-T - In absence of any legal or factual basis to support 'proportionate disallowance of Maintenance charges made by the revenue authorities, same can be removed :ITAT

++ I-T - Assessee is not in default for not having deducted tax at source on amount of bank guarantee fee u/s 194H of the Act : ITAT

++ I-T - There is no infirmity in order of CIT (A) in deleting addition on protective basis, when addition already made on substantive basis, have been confirmed : ITAT

January 03, 2022

++ I-T - surcharge on sales tax or turnover tax, being exclusive levies on State Government undertakings, does not qualify as fee or charge as per Section 40(a)(iib) of the I-T Act, for purposes of disallowance : SC

++ I-T - Re-assessment is unsustainable where no new material is on record to establish escapement of income: HC

++ I-T - Re-assessment not tenable where Revenue omits to establish assessee's failure to make full & true disclosure of material facts: HC

++ I-T - Power of revision under Section 263 can be exercised only on satisfying twin test of original assessment order being erroneous as well as prejudicial to Revenue's interests : ITAT

++ I-T - Where charge is not properly set out in notice u/s 274 without striking off inapplicable limb, but penalty has been levied, then such penalty order gets vitiated: ITAT

++ I-T - Disallowance u/s 14A cannot exceed exempt income: ITAT

++ I-T - No addition can be made doubting genuineness of purchases, if justified evidences are produced: ITAT

January 01, 2022

++ I-T - Assessee is absolved of liability to explain about transaction once she explains that she has not deposited any amount in the joint account and second account holder admits that amount was deposited by him : ITAT

++ Wealth Tax - Determination of date of ownership over land is necessary to determine net wealth: ITAT

++ I-T- Mere fact that assessee received dividend has no role to play in computing disallowance u/s 14A except to limit disallowance to quantum of dividend : ITAT