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S. 68 cash credit: If the assessee has explained the source of the loans received by it, the fact that the lender may have raised bogus share capital to advance the funds to the assessee does not mean that the loan received by the assessee can be treated as unexplained income. A statement recorded under duress, which is retracted later, cannot be the sole basis for addition
Anil Chhaganlal Jain vs. ACIT
(2017) TaxCorp(LJ) 12853 (ITAT-MUMBAI) · Section 68
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S. 56(2)(vi): A HUF is a "group of relatives". Consequently, a gift received from a HUF by a member of the HUF is exempt from tax as provided in the Explanation to s. 56(2)(vi)
DCIT vs. Ateev V. Gala
(2017) TaxCorp(LJ) 12852 (ITAT-MUMBAI) · Section 56(2)(vi)
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ITAT - When the name of the assessee does not appear in the panchanama and no material is seized with respect to the assessee, it is conclusive proof that no search was at all conducted. Proceedings under section 153A is without any valid jurisdiction.
M/s Unique Star Developers Versus Dy. Commissioner of Income Tax-Central Circle-7, Mumbai
(2017) TaxCorp(LJ) 12827 (ITAT-MUMBAI) · http://taxcorp.in/FileOpenDT.aspx?ID=55981&Category=ITAT&CategoryType=Zip
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ITAT - Agreement for acquiring media rights was pursuant to assessee’s normal business activity, therefore forfeited media rights advance is a revenue loss. Despite arbitration proceedings, as assessee did not visualize any sign of recovery, it wrote-off the forfeited amount, which is valid.
Zee Entertainment Enterprises Ltd. vs. Additional ACIT
(2017) TaxCorp(LJ) 12819 (ITAT-MUMBAI)
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ITAT - Amount received on account of reimbursement which has been received over and above the amount of FTS cannot be included and taxed as part of FTS.
Gemological Institute International Inc, C/o GIA India Laboratory P Ltd. Versus Dy. CIT 2 (2) (1), Mumbai
(2017) TaxCorp(LJ) 12816 (ITAT-MUMBAI) · http://taxcorp.in/FileOpenDT.aspx?ID=55970&Category=ITAT&CategoryType=Zip
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Transfer Pricing: Law explained as to when the “Resale Price Method” (RPM) can be used with respect to related parties under Rule 10B (1)(b) + Law on determining arm’s length rate of the corporate guarantee commission/fee explained
Zee Entertainment Enterprises Ltd vs. ACIT
(2017) TaxCorp(LJ) 12811 (ITAT-MUMBAI)
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S. 271(1)(c) penalty proceedings are “quasi-criminal” and ought to comply with the principles of natural justice. The non-striking of the irrelevant portion in the show-cause notice means that the AO is not firm about the charge against the assessee and the assessee is not made aware as to which of the two limbs of s. 271(1)(c) he has to respond. The fact that the assessment order is clear about the charge against the assessee is irrelevant (Samson Perinchery (Bom) followed, Kaushalya 216 ITR 660 (Bom) distinguished)
Meherjee Cassinath Holdings Pvt. Ltd vs. ACIT
(2017) TaxCorp(LJ) 12810 (ITAT-MUMBAI) · Section 271(1)(c)
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ITAT - 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. No penalty u/s 271(1)(c).
Earthmoving Equipment Service Corporation Versus Deputy Commissioner Of Income Tax, 22 (2), Mumbai
(2017) TaxCorp(LJ) 12806 (ITAT-MUMBAI) · http://taxcorp.in/FileOpenDT.aspx?ID=55938&Category=ITAT&CategoryType=Zip
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S. 271(1)(c): Bogus purchases cannot be assessed as 'unexplained expenditure' u/s 69C if the transactions are duly disclosed and payments are through banks. The fact that the sellers are not traceable and the assessee surrendered the bogus purchases does not justify levy of penalty. Mere non-striking of the options in the s. 274 notice does not render the penalty proceedings void if the assessment order shows due application of mind.
Earthmoving Equipment Service Corporation vs. DCIT
(2017) TaxCorp(LJ) 12796 (ITAT-MUMBAI) · Section 271(1)(c)
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S. 2(15)/12AA: The activities of Banquet Hall Hiring, Hospitality (Restaurants) and Permit Room (Bar) are prima facie in the nature of carrying on trade, commerce, or business for consideration and are hit by the proviso to s. 2(15). If the receipts from these activities are in excess of the minimum prescribed threshold limit, the DIT is required to conduct detailed enquiry and examination as to the nexus between the activities and trade, commerce or business
MIG Cricket Club vs. DIT (E)
(2017) TaxCorp(LJ) 12734 (ITAT-MUMBAI) · Sections 2(15), 12AA
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S. 263: There is a distinction between “lack of enquiry” and “inadequate enquiry”. If the AO has called for the necessary details and the assessee has furnished the same, the fact that the AO is silent in the assessment order does not mean that he has not applied his mind so as to justify exercise of revisional powers by the CIT u/s 263
Small Wonder Industries vs. CIT
(2017) TaxCorp(LJ) 12685 (ITAT-MUMBAI) · Section 263
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ITAT - In absence of a substantive order the AO was not justified in passing a protective order.
Nita Donald Sequeira Versus Income tax officer-17 (2) (4) (Formerly ITO-12 (2) (4) ), Mumbai.
(2017) TaxCorp(LJ) 12639 (ITAT-MUMBAI) · http://taxcorp.in/FileOpenDT.aspx?ID=55550&Category=ITAT&CategoryType=Zip
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ITAT - The mere fact that the CIT is not in agreement with the view adopted by the AO, would not render the order of assessment erroneous and prejudicial to the interest of Revenue.
Future Ideas Co. Ltd. Versus Principal CIT – 9, Mumbai
(2017) TaxCorp(LJ) 12638 (ITAT-MUMBAI) · http://taxcorp.in/FileOpenDT.aspx?ID=55553&Category=ITAT&CategoryType=Zip
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ITAT -As the funds for purchase of vehicles have been provided by the assessee company and they have been shown as assets of the assessee company. Hence, the assessee company should be considered as owner for all practical purposes and hence it is entitled for depreciation even where motor car registered in the name of the Director and not the company.
Dy. Commissioner of Income Tax Circle 2 (2), Mumbai Versus M/s. Kaytee Corporation Pvt. Ltd.
(2017) TaxCorp(LJ) 12637 (ITAT-MUMBAI) · http://taxcorp.in/FileOpenDT.aspx?ID=55555&Category=ITAT&CategoryType=Zip
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ITAT - Section 44BBB is computational provision and hence, it cannot enlarge the scope of total income which is otherwise provided in Section 4,5, & 9 of the Income Tax Act.
M/s. ATOMSTROY EXPORT C/o NUCLEAR POWER CORPORATION OF INDIA LTD. Versus DEPUTY DIRECTOR OF INCOME TAX (INTERNATIONAL TAXATION) Range 1 (1), Mumbai
(2017) TaxCorp(LJ) 12630 (ITAT-MUMBAI) · http://taxcorp.in/FileOpenDT.aspx?ID=55534&Category=ITAT&CategoryType=Zip
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ITAT - Delay in filing an appeal before the CIT(A) - Keeping in view the Principle of Natural Justice and to provide the assessee an opportunity of hearing on merit, it is appropriate to accept the appeal of assessee. There should be pedantic approach and the doctrine that is to be kept in mind that the appeal has to be deal with rational common sense and the cause of substantial justice must be kept in mind.
Mr. Vishwanath K. Acharya Versus ACIT Ward- 16 (1), Mumbai
(2017) TaxCorp(LJ) 12628 (ITAT-MUMBAI) · http://taxcorp.in/FileOpenDT.aspx?ID=55536&Category=ITAT&CategoryType=Zip
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ITAT - Share income from partnership firm to be excluded while computing book profit u/s. 115JB.
M/s. Shloka Traders Pvt. Ltd. Versus DCIT Central Circle-13, Mumbai
(2017) TaxCorp(LJ) 12566 (ITAT-MUMBAI) · http://taxcorp.in/FileOpenDT.aspx?ID=55435&Category=ITAT&CategoryType=Zip
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Bogus Purchases: If the assessee has not discharged the onus of producing the documentation and the suppliers, the AO is entitled to estimate the gross profit. The GP estimate should be fair, honest and rational and cannot be arbitrarily applied at the discretion of the AO. Industry comparisons or other rational comparability vis-à vis preceding years GP ratio should be brought on record. The books should be rejected. On facts, GP ratio of 12.5% as applied in Simit P Sheth 356 ITR 451(Guj) is fair, reasonable and rational after giving credit for the GP already declared
Ratnagiri Stainless Pvt. Ltd. vs. ITO
(2017) TaxCorp(LJ) 12564 (ITAT-MUMBAI)
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S. 68 bogus gains from penny stocks: If the AO relies upon the statement of a third party to make the addition, he is duty bound to provide a copy of the statement to the assessee and afford the opportunity of cross-examination. Failure to do so vitiates the assessment proceedings. A transaction evidenced by payment/receipt of share transaction value through banking channels, transfer of shares in and from the D-mat account, etc cannot be treated as a bogus transaction so as to attract s. 68
Sunil Prakash vs. ACIT
(2017) TaxCorp(LJ) 12491 (ITAT-MUMBAI) · Section 68
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S. 41(1)/ 115JB: Entire law explained whether remission of a loan can be assessed as income u/s 41(1) and if not whether the same can be added to "book profit" for purposes of MAT tax u/s 115JB
JSW Steel Ltd vs. ACIT
(2017) TaxCorp(LJ) 12382 (ITAT-MUMBAI) · Sections 41(1), 115JB
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