INCOME TAX
ITAT Deletes Additions As Assessee Proved Genuineness Of Purchases By Documentary Evidence
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the additions on the grounds that the assessee proved the genuineness of the purchases through documentary evidence.The two-member bench of Yogesh Kumar US (Judicial Member) and Pradeep Kumar Khedia (Accountant Member) has excluded the statement of the witness of the department as no opportunity of cross-examination was accorded to the assessee. The appellant/assessee is in the business of manufacturing and...
Depreciation To Be Carried Forward For Set Off In Succeeding Assessment Years: ITAT
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) headed by G.S. Pannu (President) and C.N. Prasad (Judicial Member) has ruled that in case the depreciation exceeds the business income, then the Assessing Officer should allow the depreciation to be carried forward for set off in succeeding assessment years.The respondent/assessee for the AY 2016-17 e-filed the return of income, declaring nil income after adjusting for brought forward losses of Rs.7,37,804. In the course of...
Notice For Reopening Of Assessment Against Dead Person Is Invalid: ITAT Quashes Re-Assessment Order
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has ruled that the notice for reopening of the assessment against the dead person is invalid. The two-member bench of Kul Bharat (Judicial Member) and Pradeep Kumar (Accountant Member) has observed that the Assessing Officer has accentuated the legal fallacy by continuing to proceed against the dead person by issuing notice under Section 143 (2) and Section 142(1) of the Income Tax Act. The re-assessment order passed pursuant...
Subsidy Received From The Government In The Form Of Refund Of VAT And CST, To Encourage Industrial Growth, Is A Capital Receipt: Pune ITAT
The Pune Bench of ITAT has ruled that a subsidy granted by the State of Maharashtra, with the objective of encouraging industrial growth in less developed areas of the State, is a capital receipt even though the said subsidy is disbursed in the form of refund of Value Added Tax (VAT) and Central Sales Tax (CST). The Bench, consisting of S. S. Viswanethra Ravi (Judicial Member) and Inturi Rama Rao (Accountant Member), reiterated that for considering whether a subsidy is a capital...
Commission Earned On Distribution Of Indian Mutual Fund Outside India, Not Taxable: ITAT Mumbai
The Mumbai Bench of ITAT has ruled that the commission earned on distribution of Mutual Funds schemes of an Indian fund outside India cannot be taxed in India, if all the operations are carried out by the distributor outside India. The Bench, consisting of Pramod Kumar (Vice President) and Sandeep Singh Karhail (Judicial Member), held that merely because the Mutual Funds distributed were controlled and regulated by SEBI and RBI in India, the commission earned by the...
Delayed Audit Report Due To the Delay By Statutory Auditors: ITAT Deletes Penalty
The Cuttack Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the penalty where the assessee has sufficient and reasonable cause for delay in obtaining the audit report. The two-member bench of George Mathan (Judicial Member) and Arun Khodpia (Accountant Member) has observed that the delay in submitting the audit report was on account of a delay in obtaining the audit report from the statutory auditors. The statutory auditors are appointed by the Registrar of Co-operative...
Society Receiving Grant From Foreign Entity Can't Be Denied Section 12A Registration: ITAT
The Hyderabad Bench of Income Tax Appellate Tribunal (ITAT) consisting of K.Narasimha Chary (Judicial Member) and Bhagirath Mal Biyani (Accountant Member) has ruled that the society receiving grant from foreign entity cannot be denied the registration under Section 12A of the Income Tax Act. The assessee/appellant is a society named "Share India". On 11.02.2019, the assessee filed an application on Form No. 10A to the CIT (E) for a grant of registration under section 12A of the Income...
Loss From Trading In Commodity Derivatives Non-Speculative In Nature, Can Be Set Off Against Regular Business Income: ITAT Lucknow
The Lucknow Bench of ITAT has ruled that trading in commodity derivatives, that satisfies the requirements of Clause (e) of the first proviso to Section 43 (5) of the ITAT, 1961, is non-speculative in nature, and thus the loss arising from it can be set off against the regular business income. The Bench, consisting of A.D. Jain (Vice President) and T.S. Kapoor (Accountant Member), held that there is no bar of expertise required for trading in commodity derivatives and that Clause (e) of...
Export Entitlements And Duty Drawback Of Promotion Scheme Is An Income Assessable Under "Profits Or Gains From Business Or Profession": ITAT
The Visakhapatnam Bench of the Income Tax Appellate Tribunal (ITAT) has ruled that the export entitlements and the duty drawback of the promotion scheme are an income assessable under the head "profits or gains from business or profession" as per clauses (iiib) and (iiid) of section 28 of the Income Tax Act, 1961. The two-member bench of Duvvuru Rl Reddy (Judicial Member) and S. Balakrishnan (Accountant Member) concluded that the authorities below failed to appreciate the legislative...
Delay In Filing Audit Reports Due To The Hospitalisation Of Accountant: ITAT Deletes Penalty
The Pune Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the penalty for delay in filing audit reports due to the hospitalisation of the assessee's accountant. The two-member bench, led by R. S. Syal (Vice President) and Partha Sarathi Chaudhury (Judicial Member), concluded that the assessee had explained the reasonable cause through documentary evidence.The Tribunal set aside the order of the CIT (A) and directed the AO to delete the penalty from the hands of the...
Tuition Fee Is Taxable Only When A Corresponding Service Is Rendered By The Educational Institution: Hyderabad ITAT
The Hyderabad Bench of ITAT has ruled that the tuition fee collected in advance is not taxable in the year of receipt and that the tuition fee is taxable only when a corresponding service is rendered by the educational institution. The Bench, consisting of K. Narasimha Chary (Judicial Member) and Rama Kanta Panda (Accountant Member), held that examination fee collected from students on behalf of the foreign universities is not taxable as 'Fees for Technical Services'. The ITAT ruled...
Tax Cases Weekly Round-Up: 29 May To 4 June, 2022
Karnataka High CourtJust Because The Ratio For Payment Of Service Tax Not Adhered To, Assessee Not Liable To Pay Double Tax As Penalty: Karnataka High Court Case Title: The Vice Chairman Settlement Commission & Anr. versus M/s Zyeta Interiors Pvt. Ltd & Anr. The Karnataka High Court has ruled that merely because the ratio in which service tax was required to be paid by the service recipient and the service provider was not strictly adhered to, the assessee cannot be made...