Delhi High Court Sets Aside ₹232 Crore Ex Parte IT Assessment Against Nayati Healthcare During Insolvency

The Delhi High Court has recently set aside an ex-parte best judgment assessment assessing the Nayati Healthcare and Research NCR Private Limited's income at Rs. 232 crore, which was passed while the company was undergoing Corporate Insolvency Resolution Process (CIRP).A Division Bench of Justice Dinesh Mehta and Vinod Kumar allowed the writ petition filed by the assessee, observing that at the relevant time the company was under CIRP and neither the suspended management nor the Interim...

Matching Solutions Not Taxable Under India–US DTAA: Delhi High Court Grants NIL TDS Relief To Refinitiv US

The Delhi High Court has recently set aside a 15% tax withholding certificate issued to Refinitiv US LLC, a financial market data company under Section 197 of the Income Tax Act, 1961.A Division Bench of Justices Dinesh Mehta and Vinod Kumar directed the tax authorities to issue a NIL TDS certificate in respect of income earned from its Matching Solutions services, holding that such income is not taxable in India under the India–US Double Taxation Avoidance Agreement (DTAA).The development comes...

Airline Operations Exempt Under India-UK DTAA: Delhi High Court Directs NIL TDS Certificate For British Airways

The Delhi High Court has set aside an order of the Income Tax Department issuing a 0.1% TDS certificate to British Airways under Section 197 of the Income Tax Act, 1961.A Division Bench of Justices Dinesh Mehta and Vinod Kumar directed the authorities to issue a NIL TDS certificate, holding that income from airline operations is exempt under the India–UK Double Taxation Avoidance Agreement (DTAA).The development comes in a petition moved by British Airways, a tax resident of the United Kingdom,...

Punjab & Haryana High Court Bars Higher Bank Guarantee Demand For Delay In Releasing Seized Jewellery

The Punjab and Haryana High Court on 18 February, directed the Income Tax Department to immediately release jewellery seized from the Sanjeet Singh and other petitioners, holding that the department cannot demand a higher bank guarantee due to an increase in gold prices when the delay in release was solely attributable to administrative lapses of the authorities. A Division Bench of Justice Deepak Sibal and Justice Lapita Banerji allowed a writ petition which sought the release of jewellery...

Change Of Opinion Not Enough To Reopen Assessment: Calcutta High Court

The Calcutta High Court on 20 February held that revisional powers under Section 263 of the Income Tax Act, 1961 cannot be invoked merely because the Principal Commissioner holds a different opinion on the nature of income. A Division Bench of Justice Rajarshi Bharadwaj and Justice Uday Kumar, dismissed an appeal filed by the Principal Commissioner of Income Tax, Kolkata, and upheld the order of the Income Tax Appellate Tribunal setting aside revisionary proceedings against Russel Credit...

ITAT Ahmedabad Deletes ₹9.65 Crore Addition On Demonetisation Cash Deposits Backed by Recorded Sales

The Ahmedabad Bench of the Income Tax Appellate Tribunal recently held that once purchases are accepted and stock is not disputed, sales cannot be treated as unexplained cash credits merely because the cash was deposited during the demonetisation period. A bench of Judicial Member Sanjay Garg and Accountant Member Annapurna Gupta deleted an addition of Rs.9,65,97,834 made under Section 68 of the Income Tax Act, holding, “Once the purchases are accepted and the stock is not disputed, the sales...

TDS Not Required Where Income Not Chargeable To Tax In India: ITAT Ahmedabad

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) has upheld the deletion of a Rs. 5.63 crore disallowance made against Jagson Colorchem Limited, holding that commission paid to foreign agents for services rendered outside India is not chargeable to tax in India. The Bench of Judicial Member T R Senthil Kumar and Accountant Member Narendra Prasad Sinha, observed: “Once the income is not chargeable to tax in India, the question of deducting TDS thereon under the provision of...

Delhi ITAT Deletes ₹175.03 Crore Tax Addition, Holds Livestock Supplier's Deals With HMA Agro Genuine

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has dismissed the Revenue's appeals and upheld deletion of a protective addition of Rs.175.03 crore and an estimated commission addition of about Rs.1.75 crore made against a livestock supplier on allegations of providing accommodation entries to HMA Agro Industries Ltd. The Bench of Judicial Member Vimal Kumar and Accountant Member S. Rifaur Rahman held that once the transactions were found to be genuine business transactions, the...

'Cannot Wear Cap of A Businessman': ITAT Delhi Deletes ₹53.30 Lakh Disallowance Against Zeta

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has granted relief of Rs. 53.30 lakh to Zeta Buildtech Pvt. Ltd., a distributor of liquor and beverages, by deleting disallowances on payments to independent service providers and holding that the Revenue cannot question the commercial wisdom of such expenditure. For Assessment Year 2020–21, Zeta had declared total income of ₹98.48 lakh.The Assessing Officer had disallowed Rs. 31.80 lakh paid to S.P. Jindal Financial Services Limited...

ITAT Chennai Deletes Penalty for Under-Reporting Of Income After Finding 99% Tax Covered by TDS

The Chennai Bench of the Income Tax Appellate Tribunal has recently deleted a Rs. 2.57 lakh penalty imposed under Section 270A of the Income Tax Act (penalty for under-reporting of income) on an individual salaried taxpayer. The tribunal noted that TDS (tax deducted at source) on the assessee's salary had almost covered 99% of the total tax demand and held that, “When tax liability is covered by TDS, there is no manafide intention on the part of the assessee to conceal any particulars of...

ITAT Delhi Quashes Revision Order Against Studds, Flags Lack of Clear Findings

The Delhi Bench of the Income Tax Appellate Tribunal has recently set aside a revision order passed against Studds Accessories Limited for Assessment Year 2020–21, holding that the Principal Commissioner failed to show how the assessment was “erroneous as well as pre-judicial to the interest of the revenue.” Studds Accessories Limited is a popular two-wheeler helmert manufacturer. Allowing the appeal, the Bench of Judicial Member Raj Kumar Chauhan and Accountant Member S. Rifaur Rahman said...

ITAT Mumbai Upholds Fresh Examination of Ambuja Cements' AY 2019–20 Assessment For Lack Of Inquiry

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has dismissed Ambuja Cements Limited's appeal against a revision order that had set aside its completed tax assessment for fresh verification, holding that the original assessment was passed “without due examination and verification.” The company had challenged the Principal Commissioner of Income Tax's order under Section 263 revising and setting aside its Assessment Year 2019–20 assessment on the ground that the Assessing Officer...