TODAY'S CASE (DIRECT TAX)

Sept 30, 2022

++ I-T - Alienation of property by taxpayer is not void if made for adequate consideration and without priorly receiving any notice from I-T Dept. about pendency of assessment or notice of any tax liability: HC

++ I-T - Order of PCIT u/s 263 is unsustainable as in revisionary proceedings PCIT again conducted an inquiry into claim of assessee based on like material: ITAT

++ I-T - In case, claim of TDS is not allowed, amount included in income should be reduced: ITAT

++ I-T - There is no need for rectification u/s 154 when there is no mistake apparent and facts on record only discloses error in accounting entry by Accountant: ITAT

++ I-T - Deliberately writing off good debtor as bad debt in books to reduce tax liability qualifies as colorable device: ITAT

++ I-T- If AO takes one of possible views in particular situation then decision of AO can not be held as erroneous and/or prejudicial to interest to revenue - ITAT

++ I-T - Revenue Department cannot pick & choose certain transactions treating them as bogus/unexplained and treating other transactions as genuine: ITAT

++ I-T - Amount deposited during demonitization cannot be considered as unexplained money without proof: ITAT

Sept 29, 2022

++ I-T - Additions framed u/s 69 on account of unexplained investment are valid where assessee is unable to justify cash withdrawals far exceeding income figures declared for relevant period : ITAT

++ I-T - Loose slips found during search relateing to certain purchases made in respect of real estate projects, can't be treated as 'undisclosed purchase' even if not disclosed in return, if no sales were booked: ITAT

++ I-T - Assessee having fulfilled condition for claiming exemption in relevant year by depositing net consideration in capital gain account scheme of Bank before due date of filing return, is eligible for exemption u/s 54F: ITAT

++ I-T - Additions framed on account of STCG/LTCG upheld where assessee does not appear for personal hearing & does not submit any evidence to support own claims: ITAT

++ I -T - Recourse u/s 153A and 153C being special procedure for assessment gets triggered upon receipt of incriminating material post any search or requisition: ITAT

++ I-T- Failure on part of AO to consider amount of Rs. 11 lacs as was discernible from impounded notepad has rendered his order as erroneous : ITAT

++ I-T - Transfer of funds/donation to non-existent lender, amounts to systematic financial maneuver to legitimate illicit moneys and evade taxes: ITAT

Sept 28, 2022

++ I-T - Once source of unsecured loans and cash deposits stands sufficiently explained, no addition is permitted u/s 69C: HC

++ I-T - Comparable companies selected by assessee for benchmarking purposes is invalid where rejection is based on conjecture and surmises: HC

++ I-T - Disputed questions of facts cannot be adjudicated by writ court exercising jurisdiction under Article 226 of Constitution: HC

++ I-T - Investment advisor or sub-advisory cannot be compared with merchant banker or investment banker, for purposes of benchmarking: HC

Sept 27, 2022

++ I-T - Writ remedy cannot be invoked when matter at hand involves questions of facts and where alternate remedy of appeal is provided for but is unused: HC

++ I-T - Once statute provides for opportunity of hearing and same is not complied with and breached, it could be said to have operated prejudicial to assessee: HC

++ I-T - Purchases made by an assessee during certain period cannot be deemed to be bogus in entirety, solely because some of such purchases were made from bogus dealers: HC

++ I-T - Term ' information ' in Explanation-1 u/s 148 cannot be lightly resorted to so as to reopen assessment & this information cannot be ground to give unbridled power to Revenue: HC

Sept 26, 2022

++ I-T - Export of software embedded on hardware is eligible for deduction u/s 10A: HC

++ I-T - Two writ petitions filed to challenge same order proposing to transfer assessment, are not tenable - subsequent petition not maintainable: HC

++ I-T - Re-assessment - SCN issued to assessee 19 months after demise of assessee is void ab initio : HC

++ I-T - If allegations against assessee was not detrimental to security of Country nor to strategic interest of country nor any allegation of assessee having potential to indulge in act of terrorism, he shall be released on bail : HC

++ I-T - Addition can be made u/s 69C on account of unverifiable elements involved in direct expenses claimed by assessee, if there is failure on his part to furnish documents to substantiate his claim: ITAT

++ I -T - Additions cannot be allowed after completion of assessment if there is no new incriminating material against assessee : ITAT

Sept 24, 2022

++ I-T- Initiation of 263 proceedings is not justified where AO has made enquiries and after consideration of materials accepted genuineness of claim of assessee : ITAT

++ I-T - Cash deposits made out of sale proceeds received by NRI from sale of property during demonetization, is no basis to make addition u/s 69A, once it is duly substantiated with evidence: ITAT

++ I-T- Instruction no. 03/2018 dated 11/07/2018 and instruction no. 17/2019 dated 08/08/2019, issued u/s. 268A(1) r/w s. 268A(4), applies to pending appeals : ITAT

Sept 23, 2022

++ I-T - It is fit case for remand where assessment order is passed without considering the assessee's plea of it having declared all transactions in its books : HC

++ I-T - If AO is to drop ground on which reassessment proceedings was initiated, he cannot be permitted to chase other grounds not mentioned in reasons for reopening: HC

++ I-T - In case of unabated assessment, no addition can be made in absence of any incriminating material or documents found during course of search : ITAT

++ I-T - As per section 45(3), particular of land recorded in books is to be considered as received of full value of consideration : ITAT

++ I-T - Since AY falls out of block period therefore necessary criteria to levy penalty u/s 271AAA is not applicable : ITAT

Sept 22, 2022

++ I-T - Non-disposal of application for registration within period of 6 months as stipulated u/s 12AA(2) will not result in deemed grant of registration to trust: HC

++ I-T - Service of SCN at assessee's old address not in use despite new address being on record invalidates service; re-assessment commenced based on invalid service of SCN stands vitiated: ITAT

++ I-T - If fundamental aspect of transaction is found as having permeated through different A.Ys and has stood uncontested, then Revenue cannot be allowed to change its view taken in earlier A.Ys: ITAT

Sept 21, 2022

++ I-T - AO cannot resort to provisions of Sec 14A, without recording satisfaction as correctness or otherwise of assessee's claim that no expenditure was incurred to earn exempt income: ITAT

++ I-T - When return has been filed in response to notice u/s 148 then it was mandatory for AO to issue notice u/s 143(2) before the completion of assessment : ITAT

++ I-T - Rule 6DD of I-T Rules inapplicable where assessee made cash payments on principal-to-principal basis & no agency is involved in transaction: ITAT

++ I-T - Additions u/s 68 are sustained by CIT (A) are set aside where order is passed ex parte since assessee furnished reply before wrong AO: ITAT

++ I-T - Travel expenditure incurred by assessee which has direct nexus with his business, is allowable in hands of assessee: ITAT

++ I-T - Trade advance which is in nature of commercial transaction, cannot be treated as 'deemed dividend' u/s 2(22)(e): ITAT

++ I-T - Co-operative bank has no liability to deduct TDS on interest payments made to members : ITAT

Sept 20, 2022

++ I-T - No disallowance u/s 40A(3) can be made, if transaction for which payment is made is genuine and due to business expediency and other compelling factors payment was required in cash: ITAT

++ I-T - Any income arising from sale of properties 'owned by religious institutions but held by tenant for cultivation', is taxable in individual capacity on account of deemed ownership: ITAT

++ I-T - Failure to adhere to principles of natural justice and also not providing application for seeking copy of seized documents from AO, calls for adjudication afresh: ITAT

++ I-T - Power of revision u/s 263 cannot be exercised where AO has made due inquiries & where the order is neither erroneous nor prejudicial to revenue's interest: ITAT

++ I-T - Adoption of net profit without bringing any comparable case of net profit as prevailing in the same trade / business is highly arbitrary and excessive : ITAT

++ I-T - Jewellery found with wife and mother of assessee since are old jewelleries and ancestral inheritance need not be added to income of assessee : ITAT

++ I-T - Return filed u/s 153A replaces return filed u/s 139, in case of abated assessments: ITAT

++ I-T - Payment to retiring partner would amount to diversion of income at source by overriding title: ITAT

Sept 19, 2022

++ I-T - Re-assessment - additions invalid where based on borrowed satisfaction, viz., report submitted by Investigation Wing stating that assessee indulged in transactions resulting in escapement of income : ITAT

++ I-T - Assessee cannot be made to suffer if it filed audit report in Form 10CCB in course of assessment proceedings and not along with return: ITAT

++ I-T - Amended provisions of Section 201(1) pertaining to default of non deduction of TDS, cannot be applied in respect of AY which precedes year of amendment: ITAT

++ I-T - Mention of Sec 200A in Form 35 cannot be basis to hold that appeal filed by assessee is appeal against original intimation u/s 200A and not against order u/s 154 : ITAT

++ I-T - Penalty u/s 271(1)(c) r/w Section 274 and penalties u/s 271B & 271F is valid where assessee is found to have furnished inaccurate particulars of income: ITAT

++ I-T - Limitation for rectification of order under Section 154(7) is 4 years even for intimation about the same : ITAT

++ I-T - Revisionary power u/s 263 is not validly exercised where PCIT is unable to justify it's invocation: ITAT

Sept 17, 2022

++ I-T - Leasehold rights are not covered under the statutory definition of any immovable property u/s 56 (2)(vii)(b) : ITAT

++ I-T - Interest income received cannot be treated to be loan out of accrued profits so as to attract the provisions of Section 2(22)(e): ITAT

++ I-T - Re-assessment is unsustainable where based on a set of documents which reflect incorrect income of assessee : ITAT

Sept 16, 2022

++ I-T - Competent authority cannot be faulted for dismissing application for compounding of offences, in case of non-disclosure of prior conviction by assessee: HC

++ I-T - Where assessment attains finality prior to date of search & no incriminating documents or materials had been found & seized at time of search, no addition is to be made u/s 153A as case is of non-abated assessment : HC

++ I-T - Re-opening of assessment is invalid where commenced after passage of 4 years from end of relevant AY & without there being any escapement of income : ITAT

++ I-T - If assessee has opted not to appear before Pr. CIT and has merely filed appeal but has not pursued appeal so filed by it, he cannot claim infirmity in findings of Pr. CIT framed u/s 263: ITAT

++ I-T - Re-opening of assessment is upheld where assessee is unable to furnish any evidence to contest the charges of there being escapement of income : ITAT

++ I-T - Admission of appeal on quantum would not ipso facto absolve an assessee from penalty imposed u/s 271(1)(c): ITAT

Sept 15, 2022

++ I-T - No addition u/s 69A is warranted on account of cash deposits in bank account, if they are fully substantiated with documents: ITAT

++ I-T - Any adjustments by way of intimation u/s 143(1) on debatable and controversial issues, is beyond scope of Section 143(1) : ITAT

++ I-T - Presence and absence of entries in books of accounts do not determine true nature of transaction: ITAT

++ I-T- If cash deposited in assessee's bank account has already been taxed in the hands of employer or director then no addition is warranted in hands of assessee : ITAT

++ I-T - CIT while carrying out revision u/s 263, is duty bound to examine subsequent assessment proceeding u/s 153A which have been included in assessment records: ITAT

++ I-T - Manufacturer has to cumulatively meet all stipulated conditions u/s 80IA before claiming any deduction, and onus is upon him to demonstrate that it complies with all stipulated conditions: ITAT

++ I-T - Discrepancies in silver jewellery cannot be arbitrarily said to from unexplained source, if no such fact or allegation has either been made in survey referred to by AO: ITAT

Sept 14, 2022

++ I-T - Re-opening of assessment for relevant AY merits being upheld where assessee has not submitted entire balance sheet & figures in Profit & Loss A/c and balance sheet do not tally with investments made: ITAT

++ I-T - Company engaged in construction, maintenance and operation of toll collection, is entitled for depreciation on toll collection rights being intangible asset as per section 32(1)(ii): ITAT

++ I-T - Tinkering cannot be done with book profit disclosed in audited accounts, where accounts are prepared as per accepted acounting principle: ITAT

++ I-T - Power of revision u/s 263 can be exercised only in case of 'no enquiry, as required under law' and not in case of 'inadequate inquiry': ITAT

++ I-T - Denial of registration u/s 12AA cannot be validly challenged where claimant itself withdrew its application seeking registration: ITAT

++ I-T - Power of revision u/s 263 is validly exercised, where AO omits to enquire into certain exemption claimed by assessee : ITAT

++ I-T- Claim of exemption from LTCG cannot be denied on basis of presumption and surmises : ITAT

Sept 13, 2022

++ I-T - Difference between price at which stock options were offered to employees of assessee-company under ESOP/ESPS & prevailing market price of stock on date of grant of such options, is allowed as revenue expense u/s 37: HC

++ I-T - Tour & travelling expenditure merits to be disallowed unless it is established that such expenses are incurred wholly & exclusively for purposes of business satisfying mandate of Section 37(1): ITAT

++ I-T - Once transaction of share capital and premium thereon held to be genuine, there is no question of any commission expenses for getting alleged bogus entry on account of such transaction: ITAT

++ I-T - In absence of any inconsistency in assessee's claim and non-rebuttal of supporting documents, addition cannot be sustained arbitrarily: ITAT

++ I-T - Percentage of commission earned by brokers on providing accomodation entries, has to be computed on basis of total turnover: ITAT

Sept 12, 2022

++ I-T - When assessee has sufficient interest free funds out of which investment is made, disallowance u/s 14A is not warranted: HC

++ I-T - Re-assessment in respect of deceased assessee is null unless legal heirs have appeared before AO & have participated in assessment or re-assessment proceedings : HC

++ I-T - Expenses incurred for setting up Soda Ash Project & Lab Frontend Project are revenue in nature : HC

++ I-T - Additional depreciation if claimed @ 10% in one year, being asset installed & put to use for business purpose for less than 180 days, then balance 10% of additional depreciation can be claimed in next year: ITAT

++ I-T - Interest free funds & advances and share capital given to sister concerns for business purposes, cannot be disallowed u/s 36(1)(iii): ITAT

Sept 10, 2022

++ I-T - It is non-application of mind that absence or lack of inquiry exhibits, which renders an order erroneous & thus, liable for revision: ITAT

Sept 09, 2022

++ I-T - Additions on account of bogus purchases are invalid where based solely on information received from Sales Tax Department & involving no independent investigation : ITAT

++ I-T - Amendment in law relating to forum and limitations are procedural in nature whereas amendments in law relating to rights of action and right of appeal are substantive in nature: ITAT

++ I-T - Additions framed on account of unsecured loans are valid where assessee fails to prove identity of creditors, genuineness of transaction or creditworthiness of creditors: ITAT

++ I-T - Employees' contribution to EPF and ESI need not be disallowed if such contribution was remitted before due date of filing return of income: ITAT

++ I-T - AO has rightly made addition for Security Premium Reserve of erstwhile Private Limited as income of newly incorporated LLP: ITAT

++ I-T - Since assessee merely acts as distributors or resellers by purchasing computer software, not liable to deduct any TDS u/s 195: ITAT

Sept 08, 2022

++ I-T - Revisional authority can not exercise powers u/s 263 as Revenue has already availed alternate remedy of challenging order of CIT (A) : ITAT

++ I-T - Case can be remanded to give opportunity to assessee to establish chain of transactions with evidences and to get rid of addition u/s 68 : ITAT

++ I-T - Issue of valuation/FMV accepted by AO while passing assessment order u/s 143(3) cannot be disturbed and re-determined under provisions of Sec 154: ITAT

++ I-T - When AO makes due enquiries before passing order but does not discuss all aspects in detail with regards to claims, it cannot be held that order is erroneous : ITAT

++ I-T - Assessee having elected to not furnish information in response to reopening notice u/s 148A, cannot contend that she was denied opportunity of hearing: HC

++ I-T - Previous orders restraining assessee to repatriate any money abroad, merits to be modified on ground of financial constraint, once assessee has agreed to secure interest of Revenue Department: HC

Sept 07, 2022

++ I-T- Mistake cannot always be treated as deliberate mistake on part of assessee and penalty u/s 271(1)(c) can not be imposed: ITAT

++ I-T- Sec 69A can't be invoked when entry is made in bank pass book as such entry is regarded as transaction recorded in books of accounts : ITAT

++ I-T - Once AO in case of amalgamated company for previous A.Y has already rejected claim of carry forward of business loss as per Sec 79, then same is not available to transferee company for set off u/s 72A: ITAT

++ I-T- Case can be remanded as for issue of disallowance of expenses claimed u/s 80P(2)(a)(iii) as conclusion arrived at by CIT(A) cannot be relied upon due to lack of supportive evidences : ITAT

++ I-T - Question of withdrawal of exemption u/s 11 arises only when consideration received by trust is found to be unreasonable or excessive: ITAT

Sept 06, 2022

++ I-T - Loss in earlier year to initial year already absorbed against profit of other business can't be notionally brought forward & set off against profit of eligible business as no such mandate is provided u/s 80IA(5): HC

++ I-T - Demand order and penalty imposed by Revenue Department in defiance of Writ Court's order, merits to be quashed: HC

++ I-T - Assessee's claim of outstanding balance receivable cannot be rejected without bringing any material on record to suggest that same is only accommodation entry: ITAT

++ I-T - ITO is not just an adjudicator but is an investigator as well & so cannot remain passive in face of an ITR which is apparently in order but still calls for further inquiry: ITAT

++ I-T- In absence of contrary proved by Revenue and following order passed by Tribunal in assessee's own case for previous AY, amortization of premium can be allowed : ITAT

++ I-T - Power of revision u/s 263 cannot be invoked where PCIT has change of opinion in respect of certain issues in the matter: ITAT

++ I-T - In case of unabated assessments, additions made in absence of any incriminating material are not legally justifiable : ITAT

Sept 05, 2022

++ I-T - Company petition against rejection of interest waiver u/s 220(2A) amounts to 'appeal' within scope of VsV Act: HC

++ I-T - Allahabad HC imposes cost on I-T Dept. for passing order in violation of natural justice & without considering replies of taxpayer, on pretext of technical glitches: HC

++ I-T - If assessee has given permissive possession and not legal possession as contemplated u/s 53A of Transfer of Property Act, then provisions of sec.2(47)(v) of I-T Act are not applicable: ITAT

++ I-T- There is no valid transfer of land by assessee to partnership firm of M/s. Vallabh Dvelopers in the year under consideration giving rise to any capital gain : ITAT

++ I-T - Re-assessment order passed u/s 143(3) r.w.s. 147 cannot be considered as erroneous and prejudicial to interest of Revenue, if there is no mistake crept in it: ITAT

++ I-T- Assessee trust is not entitled to exemption u/s 11 on incomes applied for benefit of Kedva Patel community, as per sec 13(1)(b) of Act: ITAT

++ I-T - Additions framed on account of unexplained cash upheld where assessee does not substantiate claim of having received cash gift & where gift deed is unregistered, many pages are in vernacular language & English translation is not furnished : ITAT

++ I-T- Generating electricity can be considered as manufacturing activity and depreciation 32(1)(iia) can be allowed : ITAT

++ I-T - Interest expenses merits to be disallowed if interest bearing funds have been utilized for purpose of interest free loans: ITAT

++ I-T - If initiation of re-assessment proceedings is not valid, releted additions can also not stand : ITAT

Sept 03, 2022

++ I-T - Date of dispatch by postal department does not for reason of its variance with date of order, dislodge statutory presumption of date of it's issue :ITAT

++ I-T - PCIT is not entitled to direct AO to initiate penalty proceedings : ITAT

++ I-T - There is no need to alter order of CIT(A) upholding protective addition made by AO as no loss is going to suffer by assessee :ITAT

Sept 02, 2022

++ I-T - Disallowance of claim is invalid where such claim was never raised in the first place: ITAT

++ I-T- Considering family tradition and deduction towards Streedhan excess jewellery found during search is nominal : ITAT

++ I-T - Additions invalid where based solely on information received from third party & in ignorance of documents placed on record: ITAT

++ I-T - Deduction u/s 54 can be allowed if deposits are made into capital gains scheme immediately and thereupon made payments to developer to acquire new property : ITAT

Sept 01, 2022

++ I-T- Assessee is entitled to claim deduction of profits earned from indirect exports u/s 10AA of Act : ITAT

++ I-T - Since vehicle has not been used exclusively for business purposes, disallowance of 15% vehicle related expenses can be confirmed :ITAT

++ I-T- In absence of material evidence additions made u/s 68 and 69 can't be removed : ITAT

++ I-T- Since explanation of assessee is unreliable with respect to gross profit estimation of income at rate of 12.5% of bogus purchases is upheld: ITAT

++ I-T - Serious infirmity and suppression in disclosed production calls for rejection of books u/s 145(3) on one hand, and estimation on other hand: ITAT

++ I-T - Interest/gains earned during pre-commencement cannot be taxed as 'income from other sources, if same was not inextricably linked with setting up of capital structure: ITAT

++ I-T - AO should not tamper with WDV of Building Block of Assets based on valuation report prepared for different purpose: ITAT