Disallowance Of Claim U/s 80P By CPC Prior To Apr 01, 2021 Is Beyond Its Jurisdiction: Kolkata ITAT

On finding that the alleged disallowance by CPC is beyond its jurisdiction as the adjustment towards deduction u/s. 80P of the Income Tax Act came to CPC only from Apr 01, 2021, the Kolkata ITAT interfered with the action of CPC in denying the deduction u/s 80P of the Income Tax Act, 1961.The Bench of the ITAT comprising Sanjay Garg (Judicial Member) and Girish Agrawal (Accountant...

Contribution Collected From Employees If Not Deposited Within Due Dates Prescribed As Per PF & ESIC Act, Is Dis-Allowable: Mumbai ITAT

The Mumbai ITAT recently clarified that mere deposit of employee's contribution before due date of filing return of income as per Section 139 of Income tax Act, will not make it eligible for deduction.Referring to the decision of Supreme Court in case of Checkmate Services Pvt Ltd. Vs. CIT (2022) 143 taxmann.com 178, the Bench of Prashant Maharishi (Accountant Member) and Narendra Kumar...

No TDS Liability Can Be Fastened For Earlier Year If Taxpayer Was Not Aware Of Subsequent TDS Certificate Issued By Depositor: Mumbai ITAT

The Mumbai ITAT restored the matter back to the file of AO to consider the lower deduction of TDS certificates and give opportunity to the assessee to explain the case.The Bench of Amit Shukla (Judicial Member) and Prashant Maharishi (Accountant Member) observed that “AO should have given opportunity to the assessee before carrying out rectification u/s. 154, so as to explain the...

AO Must Make Independent Enquiry To Verify Veracity Of Identity, Genuineness & Credit-Worthiness Of Lenders Before Making Addition U/s 68: Kolkata ITAT

Finding that the AO without examining any of the documents, simply made the addition u/s 68 on account of failure of assessee to produce share subscribers, the Kolkata ITAT held that AO cannot take adverse inference without pointing out discrepancies or insufficiency in the evidences and without examining statement of the directors of the subscriber companies.The Bench of Sanjay Garg...

Agreement With Principal Must Be Examined To Ascertain Nature Of Work Executed By Civil Contractor And Deciding Sec 80IA Deduction: Chennai ITAT

The Chennai ITAT has remanded the matter to the AO for reconsideration of disallowance u/s 80IA(4), after finding that the AO has not examined the agreement entered into by the assessee with various government and semi-government departments before invoking such disallowance.The Bench of Manjunatha G (Accountant Member) and Manomohan Das (Judicial Member) observed that “The terms and...

If Purchases Are Treated As Genuine And Stock Is Also Accepted, Then Treating Sales As Bogus Is Not Logical: New Delhi ITAT

The New Delhi ITAT ruled that once AO has accepted the sales made in cash, then source of cash deposits ought to have been treated as explained, and no addition is permitted u/s 68 of the Income tax Act.A Single Bench of Kul Bharat (Judicial Member) observed that “the AO has not commented on purchases. Undisputedly manufacturing and trading activity would be based on sale and purchase. If...

Filing Of Return U/s 139(1) Within Due Date Is Mandatory For Claiming Deduction U/s 80IB: Ahmedabad ITAT

Emphasizing that the condition of filing the return of income within the due date is mandatory in nature for claiming deduction u/s 80IB(10) of the Income tax Act, the Ahmedabad ITAT confirmed the disallowance made by the AO under the said provision.Referring to the decision of Apex Court in Wipro Ltd. vs. Pr. CIT (2022) 142 taxmann.com 562 (SC), the Bench of Suchitra Kamble (Judicial Member)...

Explanation 3 To Sec 147 Can't Be Resorted To Make Addition On Any Other Issue Which Is Not Included In Reasons For Reopening: New Delhi ITAT

On finding that no addition is made based on the reasons to believe recorded by the AO for reopening the assessment, the New Delhi ITAT quashed the order passed by the AO u/s 147 of the Income tax Act, 1961The Bench of the ITAT comprising of Anubhav Sharma (Judicial Member) and Shamim Yahya (Accountant Member) observed while referring to the decision of Jurisdictional High Court in the case...

Firm Can't Disown Ownership Over Land Simply Because Consideration For Purchase Of Land Was Paid Through Its Directors: Indore ITAT

The Indore ITAT upheld the assessment framed u/s 144 r.w.s 147 of the Income tax Act as the assessee did not cooperate during the assessment proceedings.The Bench of Vijay Pal Rao (Judicial Member) and B.M Biyani (Accountant Member) observed that “when the transaction is very much in the name of the assessee then the form of entity is irrelevant as the assessee has not disowned the ownership...

Interest Income Earned On Deposits Placed With Co-Operative Society Is Duly Eligible For Deduction U/s 80P(2)(D): Chandigarh ITAT

Finding that that the assessee is a Cooperative Society (and not a co-operative bank) which was engaged in providing short term credit facility to its members, the Chandigarh ITAT ruled that interest income has been earned on deposits placed with a co-operative society and duly eligible for deduction under section 80P(2)(d) of the Income tax Act.Referring to the decision of Supreme Court in...

Direct Tax Cases Weekly Round-Up:3 March To 9 March 2024

Delhi High Court Revisional Jurisdiction Can't Be Invoked For Inadequacy Of Enquiry By AO: Delhi High Court Case Title: PCIT Versus M/S Clix Finance India Pvt. Ltd. The Delhi High Court has held that the inadequacy of the inquiry by the AO with respect to certain claims would not in itself be a reason to invoke the powers enshrined in Section 263 of the Income Tax Act. Pick...

Filing Return By Due Date U/s 139 Is Mandatory For Political Party To Claim Exemption U/s 13A: Delhi ITAT Refuses To Stay Recovery Against Congress Party

While holding the argument that an assessee is entitled to a stay on the recovery proceedings on payment of 20% of the demand during the pendency of appeal before the Tribunal, as too general, the New Delhi ITAT dismisses the stay application of Indian National Congress treating it as meritless. At the same time, on the merits of the matter, the ITAT ruled that compliance...