S.148 Income Tax Notice Issued After 31.03.2021 Under Old Regime Invalid Despite TOLA Extension: ITAT

The Chennai Bench of Income Tax Appellate Tribunal (ITAT) has held that S.148 Income Tax notice issued after 31.03.2021 under old regime invalid despite TOLA [Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020] extension. Section 148 of Income Tax Act, 1961 empowers the Income Tax Department to reopen assessments if there's reason to suspect inaccurate income reporting. George George K. (Vice President) and S.R. Raghunatha (Accountant Member) observed that...

Transferor Not Liable U/S 56(2) Of Income Tax Act For Undervalued Property Sale To Spouse: ITAT

The Income Tax Appellate Tribunal Chennai stated that transferor not liable under Section 56(2) Of Income Tax Act for undervalued property sale to spouse. The Bench of SS Viswanethra Ravi (Judicial Member) and Amitabh Shukla (Accountant Member) observed that “the hypothesis propounded by the Ld.AO is flawed and not supported by the statutory stipulations governing the matter. It is true that the wife of the assessee has acquired a property for an amount significantly lower than its...

ITAT Rejects Revenue's Appeal Seeking To Make ₹63.21 Billion Addition To DLF's Income For AY 2017-18

The Income Tax Appellate Tribunal at New Delhi has dismissed an appeal preferred by the Revenue against an order of the National Faceless Centre (CIT(A)), deleting aggregate ₹63,02,13,86,035 addition made to income of real estate giant DLF Limited on various counts, for the Assessment Year 2017-18.In its 82-page judgement, the Tribunal also disposed of the company's appeal against confirmation of addition made by CIT(A) on account of unverified purchase transactions, by remitting the issue to...

ITAT Exempts Tax On ₹1.5 Crore Granted By BCCI To Kapil Dev In Recognition Of His Services To Cricket

The Income Tax Appellate Tribunal at Delhi allowed renowned cricketer Kapil Dev to claim exemption on Rs. 1.5 crore one-time benefit granted to him by the BCCI in 2013, in recognition of his services.Noting that the cricketer had offered the amount for tax under ignorance, bench of M. Balaganesh (Accountant Member) and MS Madhumita Roy (Judicial Member) said,“It is trite law that right amount of tax should be collected from the right person in accordance with law. Article 265 of the...

'Entire Case Based On Records Already Considered During Scrutiny': Mumbai ITAT Quashes Reopening Of Assessment Against Shah Rukh Khan For AY 2012-13

The Mumbai ITAT has quashed the reopening of assessment proceedings against the Assessee/ Appellant i.e., Shah Rukh Khan for AY 2012-13.The tribunal held that the reasons recorded while initiating the re-assessment, were completely silent as regards the allegation that income chargeable to tax has escaped assessment due to failure on the part of the assessee to disclose fully and truly all material facts. The ITAT held so after perusing the AO's order disposing the assessee's objections,...

Transactions Between Holding & Subsidiary For Issuance Of Shares Not Covered U/S 56(2)(viib) Of IT Act: Delhi ITAT Quashes Revision Against OYO

The Delhi ITAT held that the transactions between holding and its wholly owned subsidiary entity towards issuance of shares are not covered within ambit of Sec 56(2)(viib) in absence of any benefit arising from such transactions. Referring to the Coordinate Benchs, the Bench of Pradip Kumar Kedia (Accountant Member) and Yogesh Kumar US (Judicial Member) reiterated that Sec 56(2)(viib) would not apply in the present case where the transaction is between the assessee (subsidiary...

[IT Act] Section 80IB Doesn't Mandate Setting Off Losses Of One Eligible Unit Against Profits Of Another Eligible Unit: Mumbai ITAT

The Mumbai ITAT recently clarified that an industrial undertaking was not required to set off the losses incurred by it in one eligible unit against the profits earned from another eligible unit for the purpose of calculating deduction u/s 80-IB.As per Section 80-I of Income tax Act, 1961, where the gross total income of an assessee includes any profits and gains derived from an industrial undertaking or a ship or the business of a hotel or the business of repairs to ocean-going vessels or other...

Genuine Short-Term Capital Loss From Sale Of Shares Can't Be Prevented From Being Set Off Against Long-Term Capital Gain: Mumbai ITAT

The Mumbai ITAT held that a taxpayer is not prevented from arranging her affairs within the legal framework and through legitimate means to reduce his tax liability.While pointing that the Income Tax Statute does not require the assessee to pay more tax, the Division Bench of Saktijit Dey (Vice President) and Amarjit Singh (Accountant Member) observed that “short-term capital loss derived by assessee from sale of shares cannot be prevented from being set off against the long-term capital gain by...

Residence Country Can't Deny Credit On Taxes Levied By Source Country: Mumbai ITAT Grants Treaty Benefit To Amarchand Mangaldas

The Mumbai ITAT ruled that tax credit cannot be denied in cases where the interpretation of the residence country about the applicability of a treaty provision is not the same as that of source jurisdiction about the provision and yet the source country had levied taxes directly or by way of tax withholding. The Bench of Beena Pillai (Judicial Member) and Ratnesh Nandan Sahay (Accountant Member) clarified that that the DTAA provisions eliminate double taxation in all cases where the...

Sales Commission Paid To Overseas Subsidiary For Non-Technical Services Is Not 'FTS', Does Not Attract TDS Liability U/S 195: Bangalore ITAT

The Bangalore ITAT deleted the disallowance made by the AO u/s 40(a)(ia) on ground of non-deduction of tax at source on sales commission paid by the assessee company/ respondent to its US based subsidiary as well as other AE on account of selling & marketing services. The Division Bench comprising George George K (Vice-President) and Padmavathy S (Accountant Member) observed that the sales and marketing services rendered to assessee by its US based subsidiary does not fall within...

Delay In Allotting Shares No Basis To Treat Share Application Money In Hands Of Overseas AE As 'Loan': Mumbai ITAT Deletes Notional Interest

The Mumbai ITAT held that when no income had accrued from the transaction of remittance of share application money by assessee to its overseas AE, then such transaction cannot be subjected to the transfer pricing provisions The ITAT deleted a transfer pricing addition made by the TPO on account of notional interest on share application money paid by assessee to its AEs. Transaction between assessee/ Appellant and its AE was in the nature of remittance towards share application...

Employee Working Beyond Banking Hours May Be Classified As Violation Of Banking Rules, But No Basis To Assume Additional Income: Delhi ITAT

The Delhi ITAT deleted the addition made by AO in the absence of any supporting evidence, which was merely based on assumption and not on any material recovered during search and seizure. The ITAT further clarified that assessee/ employee doing overtime beyond working hours may be classified as violation of banking rules, but could not form basis for addition, assuming that assessee has received commission from his manager for same. The Bench of S. Rifaur Rahman (Accountant ...