ITAT

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There is Difference Between ‘Contract Of Work’ And ‘Contract Of Service’: ITAT Kolkata

In the case of ITO vs. Emami Paper Mills Ltd, ITAT Kolkata has held that: There is a difference between ‘Contract of work and ‘Contract of service’. The two words convey different ideas. In the ‘Contract of work’ the activity is predominantly physical; it is tangible. In the activity referred as ‘Contract of service’, the …

There is Difference Between ‘Contract Of Work’ And ‘Contract Of Service’: ITAT Kolkata Read More »

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Long Term Capital Gains Claimed Exempt u/s 10(38) Cannot Be Treated As Bogus Unexplained Income If Paper Work is in Order: ITAT Kolkata

In the case of Surya Prakash Toshniwal HUF vs. ITO, ITAT Kolkata has held that: The lower authorities have not brought on record any concrete evidence for disallowing the long term capital gain of the assessee. The AO should have issued notices and summons to M/s RFL and ACPL under section 133(6) and 131 of …

Long Term Capital Gains Claimed Exempt u/s 10(38) Cannot Be Treated As Bogus Unexplained Income If Paper Work is in Order: ITAT Kolkata Read More »

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Stock Options Are Intended To Motive Employees And So Expenditure Thereon Is A Deductible Revenue Expenditure: ITAT Delhi

In the case of Religare Commodities Ltd vs. ACIT, ITAT Delhi has held that: The discount under ESOP is in the nature of employees cost and is hence deductible during the vesting period w.r.t. the market price of shares at the time of grant of options to the employees. The amount of discount claimed as …

Stock Options Are Intended To Motive Employees And So Expenditure Thereon Is A Deductible Revenue Expenditure: ITAT Delhi Read More »

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Purchases Cannot Be Treated As Bogus Merely On The Basis Of Statements And Affidavits Filed By Alleged Vendors Before Sales Tax Department: ITAT Mumbai

In the case of ACIT vs. Mahesh K. Shah, ITAT Mumbai has held that: Mere reliance by the AO on information obtained from the Sales Department or on statements/affidavits of the 12 parties before the Sales Tax Department or that these parties did not respond to notices issued under section 133(6) of the Act, would …

Purchases Cannot Be Treated As Bogus Merely On The Basis Of Statements And Affidavits Filed By Alleged Vendors Before Sales Tax Department: ITAT Mumbai Read More »

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Section 206AA Does Not Have Overriding Effect Over Other Provisions Of The Act: ITAT Hyderabad

In the case of Nagarjuna Fertilizers and Chemicals Limited vs. ACIT, ITAT Hyderabad (Special Bench) has held that: In view of the above discussion, we are of the view that the provisions of section 206AA of the Act will not have a overriding effect for all other provisions of the Act and the provisions of …

Section 206AA Does Not Have Overriding Effect Over Other Provisions Of The Act: ITAT Hyderabad Read More »

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Disallowance Under Rule 8D is Not Compulsory Or Mandatory: ITAT Mumbai

In the case of Shapoorji Pallonji & Co. Ltd vs. DCIT, ITAT Mumbai has held that: Thus, Rule 8D is not attracted and applicable to assessee who have exempt income and it is not compulsory and necessary that an assessee must voluntarily compute disallowance as per Rule 8D of the Rules. Where the disallowance or …

Disallowance Under Rule 8D is Not Compulsory Or Mandatory: ITAT Mumbai Read More »

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Penalty Cannot Be Levied If Omission And Wrong Claim Was By Oversight And Auditors Did Not Point It Out: ITAT Mumbai

In the case of Wadhwa Estate & Developers India Pvt. Ltd vs. ACIT, ITAT Mumbai has held that: Undisputedly, in the return of income assessee has failed to offer interest on fixed deposit amounting to Rs 5,92,186 and loss claimed on account of fixed asset written–off amounting to Rs 1,82,242. It is also a fact …

Penalty Cannot Be Levied If Omission And Wrong Claim Was By Oversight And Auditors Did Not Point It Out: ITAT Mumbai Read More »

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CIT(A) Has No Power To Enhance New Source Of Income Neither Discussed in Assessment Order Nor Mentioned in ITR: ITAT Pune

In the case of Ram Infrastructure Ltd vs. JCIT, ITAT Pune has held that: It is well settled law laid down by the Hon’ble Apex Court in Commissioner of Income Tax Vs. Shapoorji Pallonji Mistry, 44 ITR 891 (SC) and Commissioner of Income Tax Vs. Rai Bahadur Hardutroy Motilal Chamaria, 66 ITR 443 (SC) and …

CIT(A) Has No Power To Enhance New Source Of Income Neither Discussed in Assessment Order Nor Mentioned in ITR: ITAT Pune Read More »

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Income Which is Not Chargeable Under Specific Provisions Of Articles 6 to 21 Cannot Be Taxed Under Residuary Provision: ITAT Chennai

In the case of DCIT vs. Ford India Limited, ITAT Chennai has held that: An income is of such a nature as, on satisfaction of conditions specified in the related provision, could be taxed under any of these specific treaty provisions, cannot be covered by this residuary clause. Take for example, income earned by a …

Income Which is Not Chargeable Under Specific Provisions Of Articles 6 to 21 Cannot Be Taxed Under Residuary Provision: ITAT Chennai Read More »

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Loose Papers Which Do Not Have Full Details Are “Dumb Documents” And Have No Evidentiary Value: ITAT Ahmedabad

In the case of Nishant Construction Pvt. Ltd vs. ACIT, ITAT Ahmedabad has held that: The AO has no power to disturb the sale price shown except in three cases. The first is under Section 145 of the Act. Where the sale of properties is part of the business of the assessee, the Assessing Officer, …

Loose Papers Which Do Not Have Full Details Are “Dumb Documents” And Have No Evidentiary Value: ITAT Ahmedabad Read More »

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Failure To Provide Copy Of Statement Relied Upon And Of Cross-Examination Renders Assessment Order Void: ITAT Ahmedabad

In the case of Sunita Jain vs. ITO, ITAT Ahmedabad has held that: There is no denying that consideration was paid when the shares were purchased. The shares were thereafter sent to the company for the transfer of name. The company transferred the shares in the name of the assessee. There is nothing on record …

Failure To Provide Copy Of Statement Relied Upon And Of Cross-Examination Renders Assessment Order Void: ITAT Ahmedabad Read More »

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Disallowance Has To Be Made Even in Respect Of Securities Held As Stock-in-Trade By Assessee: ITAT Kolkata

In the case of Kalyani Barter (P) Ltd vs. ITO, ITAT Kolkata has held that: The object of section 14A is to disallow the direct and indirect expenditure incurred in relation to income which does not form part of the total income. There is no dispute that part of the income of the assessee from …

Disallowance Has To Be Made Even in Respect Of Securities Held As Stock-in-Trade By Assessee: ITAT Kolkata Read More »

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The Onus is On Assessee To Establish Justification For Clubbing The Transactions: ITAT Bangalore

In the case of Kaypee Electronics & Associates Pvt. Ltd vs. DCIT, ITAT Bangalore has held that: The only issue that arises for consideration before us is whether the TPO was justified in making the ALP adjustment in respect of royalty payment made to M/s. Falco Limited in the given facts of the present case. …

The Onus is On Assessee To Establish Justification For Clubbing The Transactions: ITAT Bangalore Read More »

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There is Distinction Between “Lack Of Enquiry” And “Inadequate Enquiry”: ITAT Mumbai

In the case of Small Wonder Industries vs. CIT, ITAT Mumbai has held that: We are of the view, that there is a distinction between “lack of enquiry” and “inadequate enquiry”. In the present case the Assessing Officer collected necessary details, examined the same and then framed the assessment u/s. 143(3) of the Act. Therefore, …

There is Distinction Between “Lack Of Enquiry” And “Inadequate Enquiry”: ITAT Mumbai Read More »

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“On Money” Received By Assessee For Sale Of Agricultural Land Has To Be Treated As “Agricultural Income” If Assessee Has No Other Source For Receipt: ITAT Cochin

In the case of ITO vs. Abraham Varghese Charuvil, ITAT Cochin has held that: The payment of on-money is an unfortunate practice in most part of our country, and none can deny this factual situation. It is the case of the assessee that the buyers were insisting on reducing the sale consideration to be disclosed …

“On Money” Received By Assessee For Sale Of Agricultural Land Has To Be Treated As “Agricultural Income” If Assessee Has No Other Source For Receipt: ITAT Cochin Read More »

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Bogus Purchases Cannot Be Assessed As ‘Unexplained Expenditure’ If Transactions Are Duly Disclosed And Payments Are Through Banks: ITAT Mumbai

In the case of Earthmoving Equipment Service Corporation vs. DCIT, ITAT Mumbai has held that: Section 69C could not be applied to the facts of the case as the payments were through banking channels which were duly reflected in the books of accounts and therefore, there was no unexplained expenditure within the meaning of Section …

Bogus Purchases Cannot Be Assessed As ‘Unexplained Expenditure’ If Transactions Are Duly Disclosed And Payments Are Through Banks: ITAT Mumbai Read More »

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Penalty Proceedings Are “Quasi-Criminal” And Ought To Comply With Principles Of Natural Justice: ITAT Mumbai

In the case of Meherjee Cassinath Holdings Pvt. Ltd vs. ACIT, ITAT Mumbai has held that: Apart from the aforesaid discussion, we may also refer to the one more seminal feature of this case which would demonstrate the importance of non-striking off of irrelevant clause in the notice by the Assessing Officer. As noted earlier, …

Penalty Proceedings Are “Quasi-Criminal” And Ought To Comply With Principles Of Natural Justice: ITAT Mumbai Read More »

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Gift Received From HUF By A Member Of HUF is Exempt From Tax: ITAT Mumbai

In the case of DCIT vs. Ateev V. Gala, ITAT Mumbai has held that: From a plain reading of section 56(2)(vi) along with the Explanation to that section and on understanding the intention of the legislature from the section, we find that a gift received from “relative”, irrespective of whether it is from an individual …

Gift Received From HUF By A Member Of HUF is Exempt From Tax: ITAT Mumbai Read More »

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AO Has To Make Independent Inquiry To Treat Purchases As Bogus: ITAT Mumbai

In the case of Geolife Organics vs. ACIT, ITAT Mumbai has held that: It is evident from the assessment order that on the basis of information obtained from the Sales Tax Department, Assessing Officer issued notices under section 133(6). As the assessee failed to produce the concerned parties, the Assessing Officer, primarily relying upon the …

AO Has To Make Independent Inquiry To Treat Purchases As Bogus: ITAT Mumbai Read More »

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‘Furnishing Of Inaccurate Particulars Of Income’ And ‘Concealment Of Particulars Of Income’ Have Different Connotations: ITAT Mumbai

In the case of Jehangir HC Jehangir vs. ACIT, ITAT Mumbai has held that: A perusal of the quantum assessment order reveals that the penalty has been initiated for furnishing of inaccurate particulars of income and concealment of particulars of income which, as per settled legal propositions, are different connotations and carry different meaning and …

‘Furnishing Of Inaccurate Particulars Of Income’ And ‘Concealment Of Particulars Of Income’ Have Different Connotations: ITAT Mumbai Read More »

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A Trust is Eligible For Section 54F Deduction: ITAT Mumbai

In the case of Balgopal Trust vs. ACIT, ITAT Mumbai has held that: The issue is as to whether the assessee trust, which is for the sole benefit of an individual, will be entitled to deduction u/s. 54F or not, when its status is that of A.O.P. As per Section 54F the benefits of this …

A Trust is Eligible For Section 54F Deduction: ITAT Mumbai Read More »

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Penalty For Delay in Filing TDS Returns Cannot Be Levied If Delay Was Due To Requirement To Collect PAN Of Payees: ITAT Jaipur

In the case of Argus Golden Trades India Ltd vs. JCIT, ITAT Jaipur has held that: The assessee has submitted that since there were large number of deductees scattered throughout the country, a fact not disputed by the Revenue, it took them some time to collect the PANs of these deductees and thereafter, it was …

Penalty For Delay in Filing TDS Returns Cannot Be Levied If Delay Was Due To Requirement To Collect PAN Of Payees: ITAT Jaipur Read More »

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Penalty Cannot Be Levied Unless There is “Evidence Beyond Doubt” That There Was Concealment Of Particulars Of Income Or Furnishing Inaccurate Particulars Thereof: ITAT Delhi

In the case of DDIT vs. Metapath Software International Ltd, ITAT Delhi has held that: It is an well established proposition of law that being penal in nature, the provisions of section 271(1)(c) of the Act are invoked only when there is evidence beyond doubt that there was concealment of particulars of income or furnishing …

Penalty Cannot Be Levied Unless There is “Evidence Beyond Doubt” That There Was Concealment Of Particulars Of Income Or Furnishing Inaccurate Particulars Thereof: ITAT Delhi Read More »

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Period Of Limitation For Rectification Application is Six Months From End Of Month in Which “Order is Passed”: ITAT Hyderabad

In the case of Srinivas Sashidhar Chaganty vs. ITO, ITAT Hyderabad has held that: Section 254(2) of the Act refers to the period of limitation reckoning from the end of the month in which the order Is passed’ and not from the ‘date of receipt of the order’. As rightly pointed out by the Ld …

Period Of Limitation For Rectification Application is Six Months From End Of Month in Which “Order is Passed”: ITAT Hyderabad Read More »

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Amounts Paid By Way Of Reimbursement Of Expenses Do Not Constitute Income in The Hands Of Recipient: ITAT Cochin

In the case of ACIT vs. St. Mary’s Rubbers Private Ltd, ITAT Cochin has held that: The Tribunal, while giving the above decision, had also considered the effect of CBDT Circular No.715 dated 08.08.1995 and also ruled that the said Circular was applicable only where consolidated bills were raised inclusive of contractual payments and re-imbursement …

Amounts Paid By Way Of Reimbursement Of Expenses Do Not Constitute Income in The Hands Of Recipient: ITAT Cochin Read More »

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Section 69C Cannot Be Applied Where All Purchase And Sales Transactions Are Part Of Regular Books Of Accounts: ITAT Mumbai

In the case of M/s. Fancy Wear vs. ITO, ITAT Mumbai has held that: The AO or the FAA have not rejected the books of accounts of the assessee nor have doubted the purchases made by it. The recognised principles of accountancy and tax jurisprudence hold that no sales can take place without purchases. Thus, …

Section 69C Cannot Be Applied Where All Purchase And Sales Transactions Are Part Of Regular Books Of Accounts: ITAT Mumbai Read More »

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“Concealment Of Particulars Of Income” And “Furnishing Of Inaccurate Particulars Of Income” Are Different Terms: ITAT Mumbai

In the case of Orbit Enterprises vs. ITO, ITAT Mumbai has held that: Notably, Sec. 292BB of the Act has been inserted w.e.f. 01.04.2008 and is understood basically as a rule of evidence. The implication of Sec. 292BB of the Act is that once the assessee appears in any proceedings or has co-operated in any …

“Concealment Of Particulars Of Income” And “Furnishing Of Inaccurate Particulars Of Income” Are Different Terms: ITAT Mumbai Read More »

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No Addition Can Be Made in Absence Of Direct Evidence Showing Assessee Received Cash Payment: ITAT Mumbai

In the case of ACIT vs. Katrina (Kaif) Rosemary Turcotte, ITAT Mumbai has held that: The Assessing Officer has not brought on record any clinching evidence on the basis of any enquiry made by him to demonstrate that the assessee has actually received any cash as per the evaluation sheet from Matrix. Therefore, in the …

No Addition Can Be Made in Absence Of Direct Evidence Showing Assessee Received Cash Payment: ITAT Mumbai Read More »

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Petitioner/Plaintiff Is The ‘Dominus Litis’ And It Is Open To Him To Pursue Or Abandon His Case: ITAT Mumbai

In the case of M/s Sainath Enterprises vs. ACIT, ITAT Mumbai has held that: The Petitioner/ Plaintiff is the ‘dominus litis’ and it is open to him to pursue or abandon his case. Withdrawal cannot be denied except when the person making the prayer has obtained some advantage/ benefit which he seeks to retain. To …

Petitioner/Plaintiff Is The ‘Dominus Litis’ And It Is Open To Him To Pursue Or Abandon His Case: ITAT Mumbai Read More »

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The scheme Of Income Tax Act is To Assess Real Income And Not Hypothetical Income: ITAT Mumbai

In the case of Late Shri Gordhandas S. Garodia vs. DCIT, ITAT Mumbai has held that: The expression “full value of consideration received or accruing” would mean the amount actually received by the assessee or consideration which has accrued to the assessee. The expression “accrue” means a right acquired by the assessee to receive income. …

The scheme Of Income Tax Act is To Assess Real Income And Not Hypothetical Income: ITAT Mumbai Read More »