Invalid Re-Assessment By AO Cannot Be Subject Matter Of Revision Under Section 263 Of Income Tax Act: ITAT Mumbai

The Bench of ITAT Mumbai, consisting of members Kuldip Singh (Judicial Member) and M. Balaganesh (Accountant Member), held that when an assessment framed by the Assessing Officer is invalid in law, the said invalid order cannot be the subject matter of revision under Section 263 of the Income Tax Act ,1961. The Assessing Officer (AO) had reopened assessment for the relevant years on the ground that the Assessee had failed to disclose true and full facts necessary for the purpose of...

Reassessment Proceedings Not Time Barred When Time Limit Increased Retrospectively Under Income Tax Act: ITAT

The Mumbai Bench of ITAT, comprising of members Pramod Kumar (Vice President) and Suchitra Kamble (Judicial Member), has held that reassessment proceeding cannot be held time barred when an amendment increasing limitation of time is expressly stated to be retrospective. The court added that it was not open to the ITAT and Commissioner of Income Tax (Appeals), to contest the validity of a retrospective amendment in law.During search and seizure operations by revenue authorities, the...

Loss On Investment In Subsidiary, Made To Boost Sales, Deductible As Revenue Expenditure, Rules ITAT

The ITAT Bench of Chennai, consisting of members V. Durga Rao (Judicial Member) and Manoj Kumar Aggarwal (Accountant Member), allowed the loss on investment made in subsidiary company for increasing business expediency to be written off as business loss. Allowing deduction of legal fee and due diligence expenditure incurred in acquiring a foreign entity, the ITAT ruled that the loss on acquisition made to boost trading results could not be ruled as capital in nature. The Assessee, an...

AOP Running Educational Institution Eligible For Exemption Under Section 10 (23C) (VI) Of The Income Tax Act, Rules ITAT

The ITAT Bench of Mumbai, consisting of members Kuldip Singh (Judicial Member) and Prashant Maharishi (Accountant Member), ruled that an unregistered Association of Persons (AOP), formed by an agreement merging two charitable Trusts, is eligible for exemption under section 10 (23C) (vi) of the Income Tax Act, 1961. The Assessee, an educational institution, formed as an AOP, filed an application seeking approval for exemption under section 10 (23C) (vi) of the Income Tax Act for the...

CBDT Circular Denying Tax Benefit Under MFN Clause Transgresses Income Tax Act, Rules ITAT

The ITAT Bench of Pune, consisting of members R.S. Sayal (Vice President) and Partha Sarathi Chaudhury (Judicial Member), has held that the CBDT Circular, issued in February 2022, requiring a separate notification by the Government of India for importing the benefit of the Most Favoured Nation (MFN) clause into a Double Taxation Avoidance Agreement (DTAA), transgressed the boundaries of section 90 (1) of the Income Tax Act,1961. Also, the Bench ruled, since the Circular is in the nature...