Expenditure Made On Ice Boxes Are Capital Expenditure: ITAT Upholds Disallowance Against Hindustan Coca-Cola Beverages

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has held that the expenditure made on ice chests or ice boxes was made for acquiring or bringing into existence an asset for the enduring benefit of the business and was of the nature of capital expenditure.The two-member bench of Anubhav Sharma (Judicial Member) and N.K. Billaiya (Accountant Member) has observed that if the expenditure is made for acquiring or bringing into existence an asset or advertisement for the enduring benefit...

ITAT Quashes Penalty Notice Which Was Silent On Specification Of Charges

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has quashed the penalty notice, which was silent on the specification of charges.The bench of Astha Chandra (a judicial member) and Shamim Yahya (an accountant member) has observed that no specification of charge in the penalty notice leads to the same becoming void, and the penalty on that count is to be deleted.The penalty under Section 271(1)(c) of the Income-tax Act, 1961, was levied upon the assessee on account of additions for...

Income Tax Exemption On The Voluntarily Payment Made By The Employer To The Employee Out Of Appreciation: ITAT

The Pune Bench of the Income Tax Appellate Tribunal (ITAT) has held that the payment has been made voluntarily by them out of appreciation for the employee and thus falls outside the rigours of Section 17(3)(iii) of the Income Tax Act.The two-member bench of R.S. Syal (Vice President) and Partha Sarathi Chaudhury (Judicial Member) has observed that the department could not produce any documents or evidence on record to show that the payment received from the employer was coupled with some legal...

Non-Compete Fee Related To Profession Is Made Taxable Only w.e.f. AY 2017-18: ITAT

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has held that a non-compete fee related to a profession is made taxable only with effect from AY 2017–18, and the non-compete fee in relation to a profession for periods prior to AY 2017–18 would be treated as a capital receipt.The bench of Astha Chandra (Judicial Member) and Shamim Yahya (Accountant Member) has decided in favor of the Assessee-doctor holding that the department has erred in looking beyond the service agreement entered...

In Absence Of Proper Show Cause Notice To The Assessee, There Is No Merit In Levy Of Penalty: ITAT

The Delhi Bench of the Income Tax Appellate Tribunal has held that where the initiation of penalty is one limb and the levy of penalty is another limb, then in the absence of proper show cause notice to the assessee, there is no merit in the levy of penalty.The bench of Anil Chaturvedi (Accountant Member) and Yogesh Kumar Us (Judicial Member) has relied on the decision of the Bombay High Court in the case of CIT vs. Samson Perinchery and has held that where the initiation of penalty is one limb...

ITAT Allows Section 54F Deduction Though Capital Gain Scheme Account Was Not Opened

The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) has allowed the deduction under section 54F though the capital gain scheme account was not opened.The two-member bench of V. Durga Rao (Judicial Member) and G. Manjunatha (Accountant Member) has observed that even though the assessee has not invested the sale proceeds in Capital Gain Account Scheme, but complied with the conditions under section 54F(1) by purchasing an independent house by executing a sale agreement.Under Section 54F...

Tax Cases Weekly Round-Up: 19 March To 25 March 2023

Supreme Court Only Retail Sale Can Claim Assessment Benefits Under Section 4A Of Central Excise Act : Supreme Court Case Title: Commissioner Of Central Excise & Service Versus M/S. A.R. Polymers Pvt. Ltd. Etc. Citation: 2023 LiveLaw (SC) 223 The Supreme Court has held that mere affixation of MRP does not make goods eligible for central excise duty exemption, and what is required along with the affixation is a mandate of law that directs the seller to affix such MRP. Delhi...

Characterization Of Share Application Money By AO As Unexplained Cash Credit Is Devoid Of Necessary Verifications: ITAT

The Raipur Bench of the Income Tax Appellate Tribunal (ITAT) has held that the characterization of the share application money of Rs. 25 lac by the AO as an unexplained cash credit under Section 68 of the Income Tax Act is clearly devoid and bereft of necessary verifications.The bench of Ravish Sood (Judicial Member) has observed that the matter, in all fairness, requires to be restored to the file of the AO, with a specific direction that he shall, in the course of set-aside proceedings, call...

Husband Entitled To TDS Credit On Interest Earned From Amount Gifted To His Wife: ITAT

The Income Tax Appellate Tribunal's (ITAT), Pune Bench ruled that the husband is entitled to TDS credit on interest earned on the amount gifted to his wife.The two-member bench of R.S. Syal (Vice President) and S.S. Viswanethra Ravi (Judicial Member) has held that where the income on which tax has been deducted at source is assessable in the hands of someone other than the deductee, credit for the proportionate tax deducted at source shall be given to that other person rather than the...

Assessee Not Responsible To Explain Recipients Of Receipts Shown In Form No. 26AS: ITAT

The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that the assessee is not responsible to explain the recipients of the receipts shown in Form No. 26AS.The two-member bench of Anubhav Sharma (Judicial Member) and N.K. Billaiya (Accountant Member) while deleting the additions observed that the Assessing Officer should have asked the payer, for details of the payee to whom payments have been made by the payer on which it could deduct tax at source.As per the information received...

Reasons Recorded For Reopening The Reassessment To Be Examined On Standalone Basis To Determine The Validity Of Proceedings U/s 147: ITAT

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has observed that the reasons, as recorded for reopening the reassessment, are to be examined on a standalone basis to determine the validity of proceedings under Section 147 of the Income Tax Act.The two-member bench of Sandeep Singh Karhail (Judicial Member) and M. Balaganesh (Accountant Member) relied on the Bombay High Court's decision in the case of Hindustan Lever Ltd. vs. R.B. Wadkar, which held that it is for the AO to record...

Failure Of Kidney A Reasonable Cause Which Prevented Assessee To Supply The Documents And Replies To The AO: ITAT

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has held that failure of the kidney was a reasonable cause of ailment that prevented the assessee from supplying the documents and replies to the AO.The two-member bench of Astha Chandra (Judicial Member) and Shamim Tahya (Accountant Member) has directed that the additional evidence and submissions made before the CIT(A) be accepted by the CIT-A.The assessee is in the business of trading menthol oil, and the list of various creditors...