Loss Due To Sale Of Government Securities By Bank Is “Business Loss”; ITAT Allows Income Tax Deduction

The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) has held that loss due to the sale of government securities by banks is a “business loss” and the income tax deduction is allowable under Section 37 of the Income Tax Act.The bench of T.R. Senthil Kumar (Judicial Member) and Narendra Prasad Sinha (Accountant Member) have observed that the depreciation of government securities was a deterioration in the value of security. In essence, this was a loss claimed on the valuation of the...

Rectification Application U/s 154 Can't Be Termed As Time-Barred If Taxpayer Duly Responded To Notices Issued In Consequence To Intimation U/S 143(1): Ahmedabad ITAT

Observing that the assessee was all along, from the beginning since it became aware of some intimation having been made u/s 143(1) of the Income tax Act, seeking rectification in the same, the Ahmedabad ITAT held that rejection of said rectification application as being time barred is not in conformity with law. The Bench of Annapurna Gupta (Accountant Member) observed that “the assessee had duly responded to the demand notices which were issued to it in consequence to the intimation...

Grant U/s 80G Can't Be Rejected Merely On Procedural Lapse By Making Application U/s 80G(5)(Ii) Inadvertently Instead Of U/s 80G(5)(Iii): Ahmedabad ITAT

Referring to the decision of the Calcutta Bench in ITA No. 994/Kol/2023, the Ahmedabad ITAT reiterated that the assessee, who has been granted provisional registration, is eligible to apply for final registration irrespective of the fact that the assessee had already commenced its activity even prior to the date of grant of provisional approval. The ITAT explained that Section 80G of the Income Tax Act provides tax exemptions for donations made to specified charitable institutions and...

Interest-Free/Concessional Loans To Bank Employees Taxable As Perquisite : Supreme Court Upholds Rule 3(7)(I) Of Income Tax Rules

The employer's grant of interest-free loans or loans at a concessional rate will certainly qualify as a 'fringe benefit' and 'perquisite", the Court said.

ITAT Cases Weekly Round-Up: 28 April To 4 May 2024

Payments Received Towards Interconnectivity Utility Charges From Indian Customers Is Not Royalty: ITAT Case Title: M/s. KDDI Corporation Versus The Deputy Commissioner of Income Tax (International Taxation) The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) has held that payments received by the assessee towards interconnectivity utility charges from Indian customers or end users cannot be considered royalties to be brought to tax in India. Taxing Unsold Flats In...

Interest Not Leviable From Assessee For Short Payment Of Tax Due To Payer's Default In Deducting TDS Before FY 2012-2013: ITAT

The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that since the assessee was a non-resident, the entire tax was to be deducted at source on payment made by the payer to it, and there was no question of advance tax payment by the assessee; accordingly, no interest under Section 234B could be levied upon the assessee.The bench of G.S. Pannu (Vice President) and Astha Chandra (Judicial Member) has relied on the decision of the Supreme Court in the case of Director of Income Tax, New...

Taxpayer Has Duly Established Existence Of Subscriber Companies: Kolkata ITAT Deletes Addition Made Towards Share Premium U/s 68

Referring to the decision of Bombay High court in the case of PCIT v. Paradise Inland Shipping Pvt Ltd. [2017] 84 taxmann.com 58 (Pan), the Kolkata ITAT deleted the addition made towards share capital and share premium u/s. 68 of the Income tax Act. The ITAT explained that when the nature and source of the amount so invested is known, it cannot be said to undisclosed income, so as to warrant addition on account of unexplained credit u/s 68. The Bench of Sonjoy Sarma (Judicial...

Donation By One Trust To Other Charitable Institution Out Of Accumulated Fund Is Hit By Explanation To Sec 11(2) R/w/s 11(3)(D) & Hence Taxable: Delhi ITAT

While explaining Section 11(3) of the Income tax Act, the New Delhi ITAT held that any income referred to u/s 11(2) which is paid to any trust/ institution registered u/s 12AA or to any fund/ trust/ university/ educational institution/ hospital referred to u/s 10(23C)(v) shall be deemed to be the income of such person of the previous year in which it is so applied or ceases to be so accumulated or set apart or ceases to remain so invested or deposited or credited or paid, as the case may...

No Penalty U/s 271B Can Be Levied If There Is Reasonable Cause For Failure In Timely Furnishing Tax Audit Report: Delhi ITAT

The New Delhi ITAT held that Section 44AB of the Income tax Act casts an obligation upon the assessee to get accounts audited before the specified date and furnish by that date the report of such audit. However, finding that there was reasonable cause for failure in furnishing the Tax Audit Report in time, the ITAT clarified that the present case is not a case of not getting the accounts audited in time, and therefore, held that the penalty u/s 271B is not exigible The Bench of Dr....

Amount Deposited During Demonetization Does Not Call For Addition U/s 69A If Source Of Deposit Was Sufficiently Explained: Rajkot ITAT

Finding that the assessee has explained the details of the earning of the amount which was rightly deposited during the demonetization period, the Rajkot ITAT held that the addition confirmed by the CIT(A) u/s 69A of the Income tax Act is not justified. Section 69A lays down that if, in any financial year, the assessee is found to be the owner of any money, bullion, jewellery, or another valuable article, and such money, etc., is not recorded in the books of account, if any, maintained...

I-T Authority Fails To Consider Reason For Difference In Sale Consideration & Stamp Duty: Mumbai ITAT Deletes Penalty Levied U/s 270A For Under-Reporting Of Income

Noting that neither the Assessing Officer nor the CIT(A) have taken into consideration the explanation offered by the Assessee during the assessment proceedings in relation to the difference in the sale consideration and the stamp duty valuation of immovable property, the Mumbai ITAT deleted the penalty levied u/s 270A of the Income tax Act for under-reporting of income. The ITAT clarified that Section 270A(6)(a) excludes from the ambit of under-reported income, the amount of income...

Differences In Opinion of Approved Valuer Regarding Fixation Of Value Of Particular Property Can't Be Termed As Concealment: Chennai ITAT Deletes Penalty

The Chennai ITAT held that assessee's claim on the fair market value cannot be termed as concealment of income, if such claim was based on the valuation report of an approved valuer. The Bench of Manjunatha. G (Accountant Member) and Manomohan Das (Judicial Member) observed that “The basis of the assessee's claim is the report of the approved valuer. Further, differences of opinion will always be there regarding the fixation of value of a particular property. Showing of different...