ITAT Sustains Disallowance As Cash Payment Exceeds Rs. 20,000 To Single Party In Single Day

The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) has sustained the disallowance under section 40A(3) of the Income Tax Act as a cash payment exceeds INR 20,000 to a single party in a single day.The two-member bench headed by Mahavir Singh (Vice President) and G. Manjunatha (Accountant Member) has observed that Section 40A(3), which has been amended w.e.f. 01.04.2009 by the...

Tax Cases Weekly Round-Up: 25 December to 31 December 2022

Delhi High CourtCompensation On Cancellation Of Leasehold Rights Over A Plot, Capital Receipt: Delhi High CourtCase Title: PCIT Versus Pawa Infrastructure (P) Ltd.Citation: 2022 LiveLaw (Del) 1215The Delhi High Court has held that the leasehold rights held by the assessee in the plot were a capital asset and that the compensation received by the assessee from the Government of Goa on...

ITAT Allows Expenses Incurred Towards Transfer Of Shares

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has allowed the expenses incurred towards the transfer of shares.The two-member bench of Yogesh Kumar U.S. (Judicial Member) and B.R.R. Kumar (Accountant Member) has observed that the expenses incurred by the assessee are allowable transfer expenses as per Section 48 of the Income Tax Act, and both the lower authorities have committed...

Property Transferred to Mother Through Sale Deed Is A Sale And Not Gift, Taxable As Capital Gain: ITAT

The Rajkot Bench of the Income Tax Appellate Tribunal (ITAT) has held that the property transferred by the assessee to his mother for consideration of Rs. 5 lakh is liable to be brought under the ambit of capital gain.The two-member bench of Suchitra Kamble (Judicial Member) and Waseem Ahmed (Accountant Member) has directed the AO to refer the matter to the Department Valuation Officer (DVO)...

Tax Cases Weekly Round-Up: 18 December to 24 December 2022

Supreme CourtSmall Tax Effect: Monetary Limit To Prefer An Appeal Before The Supreme Court Is Rs. 2 crores: Supreme Court Case Title: CIT Versus Swapnil Finance Pvt. Ltd. The Supreme Court disposed of the appeal on the ground of low tax effects. The division bench of Justice M.R. Shah and Justice Sudhanshu Dhulia observed that the monetary limit to file an appeal before the...

Amount Equivalent To Capital Gains Utilised For Acquisition Of New House: ITAT Allows Capital Gain Exemption

The Delhi Bench of the Income Tax Appellate Tribunal has allowed the capital gain exemption under section 54 of the Income Tax Act on the grounds that the amount equivalent to the capital gains has been used for the acquisition of a new house.The two-member bench of Yogesh Kumar US (Judicial Member) and Dr. B. R. R. Kumar (Accountant Member) has observed that the agreement for sale was signed...

Land Received In Lieu Of Business Loan Foregone, Is A Business Asset Not A Capital Asset: ITAT

The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) has ruled that the land received by the assessee in the normal course of its finance business, in lieu of a business loan foregone, would assume the character of a business asset and not a capital asset, irrespective of its treatment in the assessee's books of accounts. The bench of Mahavir Singh (Vice President) and...

Tax Cases Weekly Round-Up: 11 December to 17 December 2022

Supreme Court Income Tax Dept. Can't Initiate Reassessment Proceedings During The Pendency Of The Rectification Proceedings: Supreme Court Case Title: S.M. Overseas (P) Ltd. Versus CIT The Supreme Court has held that the income tax department cannot initiate the reassessment proceedings during the pendency of the rectification proceedings. The division bench of Justice M.R....

AO Can't Pass Rectification Order to Disallow Set-off Of Loss By Invoking Section 79 of Income Tax Act, On Change In Assessee's Shareholding: ITAT

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has ruled that Section 154 of the Income Tax Act, 1961 can only be exercised by the Assessing Officer for rectification of mistake which is apparent on the face of record. The Bench of Pramod Kumar (Vice President) and Aby T. Varkey (Judicial Member) held that the issue whether Section 79 of the Income Tax Act was applicable in...

Employees' Contribution To PF Cannot Be Disallowed Merely On The Basis Of Auditor's Statement: ITAT

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the addition made by the Centralised Processing Centre (CPC) towards employees' contributions to the Provident Fund (PF) based on the tax auditor's statement reporting the delay in employee contribution remittances.The two-member bench of Aby T. Varkey (Judicial Member) and M. Balaganesh (Accountant Member) has observed...

Matter Which Is Not The Subject Matter Of Limited Scrutiny Cannot Be Raised In Revisionary Proceedings: ITAT

The Chandigarh Bench of the Income Tax Appellate Tribunal (ITAT) has held that matters that were not subject to limited scrutiny cannot be raised in revisionary proceedings.The two-member bench of Diva Singh (Judicial Member) and Vikram Singh Yadav (Accountant Member) has observed that the matter relating to wages and labor expenses, which was not subject to limited scrutiny, cannot be raised...

ITAT Deletes Addition On Account Of Cash Deposited In The Bank Accounts During Demonetisation Period

The Raipur Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the addition on account of cash deposited in bank accounts during the demonetization period.The bench of Ravish Sood (a judicial member) has observed that the AO, by not rejecting the books of account, has clearly accepted that the cash deposited in the bank accounts by the assessee firm during the year under...