Merely Making Incorrect Claim Does Not Tantamount To Furnishing Inaccurate Particulars: Mumbai ITAT Deletes Penalty U/s 271(1)(C)

Referring to the decision of Apex Court in the case of CIT vs. Reliance Petro Products Pvt Ltd, the Mumbai ITAT reiterated that for the purpose of levying penalty, the provisions of the Income tax Act to be strictly covered and that merely making an incorrect claim does not tantamount to furnishing of inaccurate particulars.The Bench of S Rifaur Rahman (Accountant Member) & Kavitha Rajagopal (Judicial Member) observed that “even in the present case, the assessee was not queried about the...

Nature Of Business Alone Is No Justification For Disallowance On Ad Hoc Basis, Without Pointing Any Deficiency In Books: New Delhi ITAT

On finding that without pointing out anything specific defect on wholesome basis, certain part of the expenses has been discarded on estimate basis, the New Delhi ITAT deleted the addition made by AO.The Bench comprising Anubhav Sharma (Judicial Member) and Shamim Yahya (Accountant Member) observed that, “However, Tax Authorities were supposed to consider the nature of the business of the assessee being in distribution business of very competitive project like mobile phones through distributors...

CIT(A) Merely Upholding AO's Action Without Considering Merits Of Case, Amounts To Non-Compliance Of Sec 250(6): Mumbai ITAT

In the interest of natural justice, the Mumbai ITAT restored the appeal of assessee back to the CIT with a direction to the assessee that as soon as the window is available for submission of details by the CIT(A), assessee must submit the detail within the prescribed time which is to be decided on merits of addition under section 56 (2) (x) (b) of the Income tax Act, 1961.The Bench of Rahul Chaudhary (Judicial Member) and Prashant Maharishi (Accountant Member) observed that, “it is also the fact...

Sec 68 Can Be Invoked Only If Taxpayer Fails To Explain Amount Found Credited In Its Books: Mumbai ITAT

The Mumbai ITAT upheld the CIT(A)'s order to delete the addition made u/s 68 of the Income Tax Act, 1961 finding no unexplained cash credit in the books of assessee.The Bench of Pavan Kumar Gadale (Judicial Member) and Prashant Maharishi (Accountant Member) observed that, “It is not disputed that the assessee has not received any share application money in the financial year 2011-12 except allotment of shares. We find that the provisions of section 68 of the Act can be invoked or applicable,...

ITR Reflecting PAN, Bank Statement & Confirmation Of Creditors Duly Adduced: Delhi ITAT Deletes Addition Based On Unsecured Loan

On finding that AO has rejected the evidences furnished by the assessee relating to bank statement and confirmation of the creditors, without establishing any falsity in the same, the Delhi ITAT deleted the addition made by AO u/s 68 of the Income Tax Act, 1961.The Bench of Challa Nagendra Prasad (Judicial Member) and B.R.R. Kumar (Accountant Member) observed that, “The AO has disregarded the creditworthiness of the lenders stating that they did not have sufficient sources or that their income...

No Question Of Invoking Sec 201(1)/201(1A) if Taxpayer Has Deducted TDS At Appropriate Rates: Rajkot ITAT

Noting that assessee has also furnished tabular chart along with supporting documents to demonstrate that TDS at appropriate rates has been deducted on such trade discount / commission given to it's agents, the Rajkot ITAT held that assessee cannot be held as in default for not deducting TDS.The Division Bench of Waseem Ahmed (Accountant Member) & Siddhartha Nautiyal (Judicial Member) observed that “the assessee cannot be held to be an “assessee in default” for non-deduction of TDS, when...

Cash Deposit During Demonetization Can't Be Taxed As Unexplained U/S 69A If Source Is Explained: Ahmedabad ITAT

The Ahmedabad ITAT held that the AO as well as the CIT(A) was not right in making the addition of cash deposits amounting to Rs. 49,80,000/- in bank account during the demonetization period by invoking section 69A of the Income tax Act, as the assessee has fully explained the cash deposits and thus the same cannot be treated as unexplained money.The Bench of Suchitra Kamble (Judicial Member) observed that “the assessee has given all the details as to how the assessee has that much cash in hand...

Only Obvious & Patent Mistake Can Be Subjected To Rectification Proceedings U/s 154: Bangalore ITAT

The Bangalore ITAT held that the CIT(A) is not justified in confirming the order of the AO passed u/s 154 of the Income Tax Act, on finding that the issue raised in the appeal is not a mistake apparent on record.The Bench comprising of George George K (Vice President) and Chandra Poojari (Accountant Member) observed that, “the AO while issuing show cause notice for rectification had not mentioned that the assessee had violated the principles of mutuality by dealing with non-members. Therefore,...

Method Of Revenue Recognition Adopted By Taxpayer And ITO In Earlier & Later Years Cannot Be Disturbed Sans Any Modification: Ahmedabad ITAT

The Ahmedabad ITAT held that once a method of recognizing the revenue adopted by the assessee and accepted by the revenue in the earlier and later years, the same cannot be disturbed for the intervening year i.e. the year in dispute until and unless initial year is made subject to the modification.The Bench comprising Madhumita Roy (Judicial Member) and Waseem Ahmed (Accountant Member) observed that, “the PCIT himself has admitted the fact that the assessee was entitled for certain amount of TDS...

ITR Dues Claims Shall Stand Extinguished Upon Approval Of Resolution Plan If They Were Not Part Of RP, Reiterates Nagpur ITAT

Referring to the decision of Apex Court in the case of Ghanashyam Mishra And Sons vs. Edelweiss Asset Reconstruction (2021) 126 taxmann.com 132 (SC), the Nagpur ITAT found that all the claims are not part of the Resolution Plan and hence dismissed the appeal filed against the orders of National Faceless Appeal Centre.The Bench comprising S.S. Viswanethra Ravi (Judicial Member) and Inturi Rama Rao (Accountant Member) observed that, “once the proceedings have commenced by institution of...

Taxpayer Cannot Be Denied Benefit Of Sec 80IB If Audit Report & Form 3CB Was Not Uploaded Due To Technical Glitch In E-Filing: Mumbai ITAT

While remanding the matter for fresh disposal of assessee's claim u/s 80IB of Income Tax Act, 1961 in the wake of new admissible evidence, the Mumbai ITAT directed the AO to consider the audit report u/s 44AB along with Form 3CB.The Bench comprising Kuldip Singh (Judicial Member) and Gagan Goyal (Accountant Member) observed that, “Since the uploading of the audit report with form No.3CB and form No.10CCB could not be uploaded due to technical glitch as e-filing was newly introduced, the assessee...

Mumbai ITAT Upholds Exemption Granted On LTCG Upon Sale Of Equity Shares Of Indian Entity Holding Valid TRC

The Mumbai ITAT upheld the exemption of long-term capital gain granted to the Assessee, holding a valid Tax Residency Certificate (TRC), under Article 13 of India-Mauritius DTAA, on sale of equity shares of an Indian company, acquired prior to April 01, 2017.The Division Bench comprising Prashant Maharishi (Accountant Member) and Sandeep Singh Karhail (Judicial Member) observed that “the assessment order passed by the learned Assessing Officer granting benefit of Article 13 to the assessee on...