ITAT
Once Penalty Stood Levied U/s 271A For Non-Maintenance Of Books Of A/c, No Further Penalty U/s 271B Can Be Levied: Mumbai ITAT
Referring to the decision of Varadagovind Parthasarthy Iyer (through the legal heir Arvind Iyer) vs. ITO (in ITA No.1716/Mum/2023), the Mumbai ITAT ruled that penalty u/s. 271B of the Income tax Act cannot be levied in the present facts of the case for non-auditing of the books of accounts where the assessee has failed to maintain the same.The Bench of S. Rifaur Rahman (Accountant Member)...
Plausible View Taken By AO In Case Of Debatable Issue Does Not Attract Rigors Of Sec 263: New Delhi ITAT
Finding that the view taken by the AO that interest u/s 28 of Land Acquisition Act received by the assessee is exempt u/s 10(37) of the Income tax Act is not contrary to law, the New Delhi ITAT quashed the revisionary exercise of powers by the PCIT by taking aid of Section 263.The Bench of N.K. Billaiya (Accountant Member) and Astha Chandra (Judicial Member) observed that “Since the order...
No Adhoc Disallowance Is Warranted U/s 40A(2) On Payments Which Were Not Identified As Excessive Or Unreasonable By AO: Bangalore ITAT
While referring to the decision of Karnataka High Court in the case of Manipal Health System Systems Pvt. Ltd. and pointing that AO has not doubted the payment nor held the payment as excessive, the Bangalore ITAT emphasized that in terms of Section 40A (2) only 'legitimate needs of the business' is allowable as expenditure.The ITAT therefore allowed the assessee's appeal regarding...
AO Fails To Examine Relevant Material For Determining FMV Of Interest Rate For Availing Unsecured Loans: Mumbai ITAT Remits Matter
Observing that the relevant material for determining the fair market value of the interest rate for availing unsecured loans has not been examined, the Mumbai ITAT restored the issue of disallowance of excessive interest payment on unsecured loans to the file of AO for de novo adjudication.The Bench of Om Prakash Kant (Accountant Member) and Sandeep Singh Karhail (Judicial Member) observed...
Unabated Assessment Additions/ Disallowances Made In Absence Of Incriminating Material Merits To Be Quashed: New Delhi ITAT
The New Delhi ITAT quashed the unabated assessment additions / disallowances made by AO in the absence of any incriminating material.The Bench of Kul Bharat (Judicial Member) and Pradip Kumar Kedia (Accountant Member) observed that “additions/disallowances have been made without reference to any specific incriminating material/document found as a result of search and seizure action...
Lapses In Faceless Assessment Regime Should Not Render Prejudice To Effective Administration & Disposal Of Matter: Kolkata ITAT
While emphasizing that in the initial phase of a new technologically driven faceless regime, certain lapses of procedural requirements may occur, the Kolkata ITAT pointed that that such lapses should not lead to rendering prejudice to effective administration and disposal of the matter.The Bench of Sanjay Garg (Judicial Member) and Girish Agrawal (Accountant Member) observed that “lapses...
CIT(A) Accepted Stereo-Typed Defences On Behalf Of Taxpayer In Perfunctory Manner Sans Any Preliminary Inquiry: Delhi ITAT Remits Matter
Finding that both the AO and the CIT(A) have failed to discharge their quasi-judicial duties in a just and proper manner, the Delhi ITAT observed that the CIT(A) has passed a non-descript and cryptic order without dealing with the fundamental aspects of the matter.Explaining that proper examination of all materials are incumbent in law, the ITAT highlighted that the CIT(A) ought to have...
No Addition Warranted U/s 68 Once Taxpayer Has Discharged Identity & Credit-Worthiness Of Subscribers: Kolkata ITAT
The Kolkata ITAT reiterated that once the assessee has submitted the documents relating to identity, genuineness of the transaction, and credit-worthiness of the subscribers, then the AO is duty bound conduct to conduct an independent enquiry to verify the same.The Bench of Sanjay Garg (Judicial Member) and Manish Borad (Accountant Member) observed that “the assessee has successfully...
No Penalty Is Leviable U/s 271(1)(C) If Bona Fide Mistake In Original Return Was Corrected By Revised Computation During Assessment: Mumbai ITAT
On finding that assessee had made bona fide mistakes in the computation of its total income while filing its original return, which were later corrected by filing revised computation during assessment proceedings, the Mumbai ITAT deleted the penalty levied u/s 271(1)(c) of the Income Tax Act.The Bench of the ITAT comprising of Sandeep Singh Karhail (Judicial Member) and Prashant...
No ALP On AMP Expense Is Warranted In Absence Of Agreement Between Assessee And Its AE For Service W.r.t Brand Promotion Activity: Chennai ITAT
The Chennai ITAT deleted the ALP adjustment made towards advertisement expenses (AMP expenses) for alleged brand enhancement for its AE by assessee manufacturing and selling cars in India as well as exporting them to its AEs and non-AEs abroad.The Bench comprising Mahavir Singh (Vice President) and Manoj Kumar Aggarwal (Accountant Member) on identical issue, noted that the Coordinate bench...
Segregation Of Contract Manufacturing Activity And Distribution Is Fair And Reasonable: Mumbai ITAT
The Mumbai ITAT rejected the assessee's own recharacterization as value added distributor (VAD) and upheld the CUP method to benchmark import of Active Pharmaceutical Ingredients (APIs).The Bench comprising Vikas Awasthy (Judicial Member) and Gagan Goyal (Accountant Member) observed that “segregation of Contract Manufacturing activity and Distribution is fair and reasonable. Merely for...
Depreciation Should Be Removed For Calculation Of Net Profit Margin And Cash PLI Is Justified Method: Kolkata ITAT
The Kolkata ITAT recently decided on comparables selection and adoption of Cash PLI in case of entity engaged in production of continuously annealed, cold-rolled steel / coils and sheets for automotive sector.The Bench comprising Dr. Manish Borad (Accountant Member) and Anikesh Banerjee (Judicial Member) observed that “The assessee stated that considering depreciation as a part of the...