Failure To Furnish Segmental Information U/s 92D By Diamond Trader Is No Basis To Levy Penalty U/s 271G: Mumbai ITAT

On finding that transfer pricing adjustment made in the Arm's Length Price to be erroneous, the Mumbai ITAT deleted the penalty u/s 271G of Income Tax Act, 1961 for non-furnishing of requisite information u/s 92D.The Bench comprising Amit Shukla (Judicial Member) and S. Rifaur Rahman (Accountant Member) observed that, “levy of penalty under section 271G of the Act is neither fair nor reasonable and it is not justified in the present facts of the case viz., the nature of diamond trade,...

Revisionary Authority Could Not Exercise Jurisdiction U/s 263 When Larger Issue Was Pending Before CIT(A): Chennai ITAT

The Chennai ITAT held that the impugned revision u/s 263 of the Income Tax Act, 1961, was bad-in-law and liable to be quashed, while pointing that when larger issue was pending before CIT(A), the revisionary authority could not exercise jurisdiction u/s 263.Referring to the decision of Madras High Court in the case of Smt. Renuka Philip vs. ITO (409 ITR 567), the Bench comprising V. Durga Rao (Judicial Member) and Manoj Kumar Aggarwal (Accountant Member) observed that, “for the purpose of...

Loans Given By Co-Operative Banks To Their Nominal Members Qualify For Deduction U/s 80P(2)(A)(I), Reiterates Bangalore ITAT

While considering the definition of 'member' under the Kerala Act, as per which loans given to nominal members would qualify for purpose of deduction u/s 80P(2)(a)(i) of the Income Tax Act, 1961, the Bangalore ITAT directed the AO to grant relief to the assessee by allowing the claim of deduction under said provision.Relying on the decision of Supreme Court in the case of Mavilayi Service Cooperative Bank Ltd. v. CIT (2021) 123 taxmann.com 161 (SC), the Bench comprising Beena Pillai (Judicial...

Statutory Scheme Permits Allowance Of Deduction U/s 80P Only If It Is Made In Return Filed Within Time Prescribed U/s 139(1): Bangalore ITAT

On finding that failure on the part of assessee to comply with the pre-condition for obtaining the deduction cannot be condoned either by the statutory authorities or by the courts, the Bangalore ITAT ruled that the assessee is not eligible for deduction u/s. 80P of the Income Tax Act, 1961.Relying on the decision of Kerala High Court in case of Nileshwar Rangekallu Chethu Vyavasaya Thozhilali Sahakarana Sangham v. CIT [2023] 152 taxmann.com 347 (Kerala), the Bench comprising George George K....

Additions Made By AO Once Deleted By Appellate Authority With Reasoned Order, Merits Status Quo In Identical Cases: Mumbai ITAT

Relying upon the decisions of the Co-ordinate Bench, the Mumbai ITAT upheld the decision of CIT(A) in deleting the addition made u/s 68 read with section 147 of the Income Tax Act, 1961.The Bench comprising of Sandeep Singh Karhail (Judicial Member) and Prashant Maharishi (Accountant Member) observed that, “The co-ordinate Bench in paragraph no.6 and 7 after considering the remand report upheld the order of the CIT (A) with respect to bogus purchase and addition under Section 68 of the Act....

Cash Deposit In Bank Account Made Out Of Sale Proceeds Received In Cash If Duly Explained, Is Not Unexplained Credit: Delhi ITAT

Accepting the explanation given by the assessee that he had received cash on sale of property to be believable which was faithfully deposited in the bank account within a short period, the Delhi ITAT provided relief to the assessee against the order of assessment passed u/s 143(3) of the Income Tax Act, 1961.The Bench of M. Balaganesh (Accountant Member) observed that, “the explanation given by the assessee that source for cash deposit for Rs. 29 lakhs in the bank account is made out of sale...

Annual Letting Value Of Unsold Flats Held As Stock In Trade Cannot Be Considered For Addition U/s 22 I-T Act: Mumbai ITAT

While setting aside the order of CIT(A), the Mumbai ITAT directed the AO to delete the addition of annual letting out value (ALV) of the unsold flat u/s 22 of Income Tax Act, 1961.The Bench comprising Pavan Kumar Gadale (Judicial Member) and Prashant Maharishi (Accountant Member) observed that “the annual value of unsold flats held as stock in trade has to considered as per the amendment in the finance Act 2017 under section 23(5) of the Act is applicable from A.Y 2018-19 and the present case is...

Proceedings Under Remand Passed Without Application Of Mind: Delhi ITAT Deletes Addition Made By ITO

On finding that I-T Authorities had passed the same order which was earlier remanded, without proper application of mind, the New Delhi ITAT deleted the addition made by the ITOs.The Bench of Shamim Yahya (Accountant Member) observed that, “submission of the assessee has considerable cogency. Moreover, on earlier remand by the Tribunal, the authorities below have again passed the very same order without proper application of mind, in such circumstances, I set-aside the order of the authorities...

Investments In Mutual Funds Not A Basis To Conclude Activities Of Trust Are Not Genuine: Pune ITAT Restores Registration U/S 12A

On finding that entire proceeding was based on the covenants of the trust deed but not on the actual activities carried out by the appellant trust, the Pune ITAT set aside the order passed by CIT(E) cancelling the registration granted u/s 12AB(4) of the Income Tax Act, 1961.The Bench comprising Partha Sarathi Chaudhury (Judicial Member) and Inturi Rama Rao (Accountant Member) observed that, “Mere fact that the trust deed contains a covenant that enables the settlor to utilize the premises for...

Interest Income Derived By Co-Operative Society From Its Investment With Any Other Co-Operative Society Is Allowable U/s 80P(2)(D): Mumbai ITAT

While directing the AO to allow deduction u/s 80P(2)(a) or 80P(2)(d) of the Income-tax Act, 1961 of interest income earned by the assessee from the co-operative bank, the Mumbai ITAT clarified that co-operatives bank is also a co-operative society.The Bench comprising Rahul Chaudhary (Judicial Member) and Prashant Maharishi (Accountant Member) observed that, “in respect of any income by way of interest or dividend derived by the co-operative society from its investment with any other...

Investments Which Yielded Exempt Income Can Only Be Considered For Purpose Of Disallowance U/s 14A R/w Rule 8D: Mumbai ITAT

Quoting the decision of cargo motors private limited versus deputy Commissioner of income tax (145 taxmann.com 641), the Mumbai ITAT reiterated that for purpose of making disallowance of expenses u/s 14A as per rule 8D, only those investments were to be considered which yielded exempt income during the year.The Bench comprising Rahul Chaudhary (Judicial Member) and Prashant Maharishi (Accountant Member) observed that, “the assessee has more interest free funds available with it in the form of...

Taxpayer Should Not Suffer For Non-Filing Of Material Evidences: Mumbai ITAT Admits Additional Evidence

While setting aside the order u/s 68 of the Income Tax Act, 1961 passed by CIT(A), the Mumbai ITAT restored the entire disputed issues to the AO along with the additional evidence to decide the case afresh on merits, so that the assessee should be provided adequate opportunity of hearing.The Bench comprising Pavan Kumar Gadale (Judicial Member) observed that, “the evidences play important role in decision making in the adjudicating proceedings. Therefore, considering the facts, circumstances and...