Assessee Has Incurred Expenses For Transfer As Per Scheme Of Arrangement Approved By NCLT; Mumbai ITAT Directs To Allow Stamp Duty & Registration Charges

On finding that when the assessee has incurred the amount in question to complete the transfer as per the scheme of arrangement approved by the NCLT, without which the transfer could not have been effected, the Mumbai ITAT held that the CIT(A) has rightly and validly decided the issue in favour of the assessee and directed the AO to allow the stamp duty and registration charges after due verification. The Bench of the ITAT comprising of Kuldip Singh (Judicial Member) and Padmavathy S ...

Penalty Order On Ground Of Misreporting Of Income Not Justified When SCN And Assessment Order Alleged Under-Reporting: ITAT

The Hyderabad Bench of Income Tax Appellate Tribunal (ITAT) has held that the penalty order on the ground of misreporting of income was not justified when show cause notice and the assessment order alleged under-reporting.The bench of Laliet Kumar (Judicial Member) has observed that once the assessee himself admitted the fact that there was under-reporting of income, which was also accepted by the Assessing Officer, then the penalty should have been levied only on account of under-reporting of...

Taxing Unsold Flats In Real Estate Business Applicable From AY 2018-19; ITAT Deletes Notional Rent Addition For AY 2014-15

The Mumbai Bench of Income Tax Appellate Tribunal (ITAT), while deleting the notional rent addition for AY 2014–15, held that taxing unsold flats in real estate business is applicable from AY 2018–19.The bench of Sunil Kumar Singh (Judicial Member) and Narendra Kumar Billaiya (Accountant Member) has observed that the CIT(A) has erred in as much as it relied upon the provisions brought into statute by the Finance Act, 2017, and Section 23(5) has not been held to have a retrospective effect....

Payments Received Towards Interconnectivity Utility Charges From Indian Customers Is Not Royalty: ITAT

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.The bench of Beena Pillai (Judicial Member) and Laxmi Prasad Sahu (Accountant Member) has observed that at no point in time, any possession, physical custody, control, or management over any equipment is received by the end users or customers. The...

Income Tax Addition Can't Be Deleted For Sole Reason Of Erroneously Mentioning Section: ITAT

The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that the addition cannot be deleted for the sole reason that the section under which the addition is made is mentioned erroneously and that it is necessary to look into the merits of the case. The bench of Anikesh Banerjee (Judicial Member) and Padmavathy S (Accountant Member) has observed that the addition is made primarily for the reason that the assessee has not furnished details to substantiate the genuineness of the impugned...

ITAT Cases Weekly Round-Up: 14 April To 20 April 2024

Actual Expenditure, Source Of Which Was Not Explained, Attracts Deeming Provisions Of Sec 69: Ahmedabad ITAT Case Title: Hyfun Frozen Foods Pvt. Ltd. Verses Income Tax Officer The Ahmedabad ITAT recently ruled that actual expenditure, the source of which has not been explained, attracted the deeming provisions provided u/s 69 of the Income tax Act. Extension Of Timeline For Filing Form No.10AB For Recognition U/s.12A Is Deemed Extension For Renewal Of Approval Under Clause (Iii)...

Primary Agricultural Credit Society Entitled To Benefit Section 80P(2)(i) For Providing Credit Facilities For Non-Agricultural Purposes To Its Members: ITAT

The Kolkata Bench of Income Tax Appellate Tribunal (ITAT) has held that Primary Agricultural Credit Society is entitled to benefit under Section 80P(2)(i) of the Income Tax Act for providing credit facilities for non-agricultural purposes to its members.The bench of Rajpal Yadav (Vice President) and Manish Borad (Accountant Member) has observed that the appellant society is eligible for deduction u/s 80P(2)(i) of the Act, but only to the extent of the income that has been earned from the...

Manual Cash Book Contains Entries Related To Cash Withdrawals, Income Tax Additions Not Sustainable: ITAT

The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that the manual cash book contained entries related to cash withdrawals and expenses of the company, which were duly recorded and reconciled with its books of account, as well as cash introduced, withdrawn, and expenses on behalf of the assessee.The bench of Anubhav Sharma (Judicial Member) and M. Balaganesh (Accountant Member) has observed that to offset the negative cash balance reflected in the manual cash book qua the...

Cash Sales Already Offered As Income Can't Be Taxed In Garb Of Inflation Sales To Cover Up Demonetization Currency: Delhi ITAT

The New Delhi ITAT recently clarified that the cash sales already been offered as income, cannot be taxed in the garb of inflation sales to cover up demonetization currency. The Bench of N.K. Billaiya (Accountant Member) and Astha Chandra (Judicial Member) observed that “Merely because there was a minor variation in the cash sales during the alleged period compared to previous year would not mean that the assessee has inflated its sales to cover up demonetized currency”. (Para 22) ...

Money Received As Security Deposit If Subsequently Refunded To Developer, Is Irrelevant For Determining Taxability U/s 56(2)(Vii)(A): Mumbai ITAT

While deleting the enhancement made u/s 56(2)(vii)(a) of the Income Tax Act, the Mumbai ITAT explained that as per the provisions of section 56(2)(vii)(a), any sum of money, the aggregate of which exceeds Rs.50,000, received by an individual without consideration is taxable as income from other sources, and thus, u/s 56(2)(vii)(a), the incidence of taxation is at the stage of receipt of money. The ITAT clarified that the fact that the money received as a security deposit was ...

Commission Expenses Can Be Allowed If Taxpayer Satisfies Rendering Of Services By Commission Agents And Income From Same Is Shown In Return: Mumbai ITAT

While deleting the addition made u/s 68 of the Income Tax Act, the Mumbai ITAT directed the assessee to file the details of the services rendered by the commission agents for availing the commission payment from the assessee. The ITAT clarified that if the assessee satisfies the AO about the services rendered by these commission agents and that they had shown their income as the commission paid by the assessee, then such commission expenses are to be allowed under law. The...

Action Can Be Initiated U/s 153C Based On Seizure Made During Course Of Search And Not Based On Material Impounded In Course Of Survey: Mumbai ITAT

While quashing the proceedings initiated u/s 153C of the Income Tax Act based on the material impounded in course of survey action, the Mumbai ITAT clarified that the material considered for initiating action u/s 153C in the case of assessee was not seized in the course of search action but was impounded in the course of the survey action, and hence assessment u/s 153C is not as per provisions of law. The Bench of the ITAT comprising of Sandeep Singh Karhail (Judicial Member)...