ITAT Weekly Round Up

The most important stories on the Income Tax Appellate Tribunal (ITAT) that were published at Taxscan between November 18, 2023 to November 25, are critically summarized in this Round-Up. When Substantial Justice and technical considerations are pitted against each other, Cause of Substantial Justice shall be preferred: ITAT The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) held that when substantial justice and technical considerations are pitted against each other then the cause of substantial justice shall be preferred.

The Two-member bench comprising of Beena Pillai (Judicial member) and Laxmi Prasad Sahu (Accountant member) held that when substantial justice and technical consideration are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have vested right for injustice being done because of nondeliberate delay Subsidy received in form of VAT reimbursement from State Governments towards Industrialization shall be termed Capital Receipt: ITAT grants relief to Britannia Industries Assistant Commissioner of Income tax vs M/s. Britannia Industries The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) while granting relief to Britannia Industries held that the subsidy received in the form of Value Added Tax (VAT) reimbursement from the state governments towards the industrialization of the state shall be termed as capital receipt.

Two-member bench comprising of Manish Borad (Accountant member) and Sonjoy Sharma (Judicial member) held that subsidy received in the form of VAT reimbursement from the State Governments was towards industrialization in the State and to generate employment and, therefore, the entrepreneurs with the attraction of such subsidy plan to establish and commence business operations in such areas and for establishing such business has to make capital expenditure in the form of land, building, plant and machinery and such investments are partly reimbursed by the subsidies granted by the State Governments. Proceeding Initiated u/s 148 for Incriminating material found against a person other than Searched Person is beyond Jurisdiction: ITAT M/s. Ickon Projects vs Income Tax Officer Bangalore bench of the Income Tax Appellate Tribunal (ITAT) held that the proceedings initiated under Section 148 of the Income Tax Act, 1961 for the incriminating material found against a person other than the searched person is beyond the jurisdiction.

The Two-member bench comprising of Chandra Poojari (Accountant member) and Madhumita Roy (Judicial member) held that “as per the un-amended provision of Section 153C of the Income Tax Act, the proceeding against the persons other than the searched person was on the basis of seized and/or requisition “belongs or belong to” the person other than the searched person”.

Non-striking of Irrelevant limb amounts to Vagueness and Ambiguity in Notice which tantamount to Non-Application of Mind: ITAT grants relief to Global Cricket CIT(IT) vs Global Cricket Corpn Pte Ltd Mumbai bench of the Income Tax Appellate Tribunal (ITAT) granted relief to Global Cricket and held that non-striking of irrelevant limbs amounts to vagueness and ambiguity in the notice which is tantamount to non-application of mind. The Two-member bench comprising of Om Prakash Kant (Accountant member) and Kavitha Rajagopal (Judicial member) held that “non-striking of the irrelevant limb has been held to be a violation of the mandatory condition, which in turn violates the principle of natural justice”.

Interest Expenditure claimed under head of Income from House property in Original ITR: ITAT allows deduction u/s 24 of Income Tax Act Sujeev Sanjeev vs ACIT The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) allowed the deduction under Section 24 of the Income Tax Act, 1961 due to interest expenditure claimed under the head of income from house property in the original return of Income. The Two-member bench comprising of B.R. Baskaran (Accountant member) and Narendra Kumar Choudhry (Judicial member) held that the Assessing Officer was not justified in denying deduction of interest expenditure claimed under Section 24 of the Income Tax Act also he should have deducted the correct amount of interest expenditure also while determining income under the “house property”.

Therefore, the order passed by the CIT(A) was set aside and the issue was restored back to the file of the Assessing Officer. Thus, the appeal of the assessee was allowed. Failure to conduct enquiries with respect to abnormal cash deposits during Demonetization Period: ITAT upholds Revision Order The Income Tax Appellate Tribunal (ITAT), Chandigarh bench, while upholding the revision order passed under section 263 of the Income Tax Act, 1961, held that the Assessing Officer failed to conduct inquiries with respect to abnormal cash deposits during the demonetization period.

The bench bank statement furnished by the assessee is incomplete, and the AO has failed to make any further inquiries or investigations about the ownership of the said account and about the transactions therein. the two-member bench of Vikram Singh Yadav (Accountant member) and A.D. Jain (Vice President) upheld the revision order and held that the Assessing Officer failed to conduct inquiries with respect to abnormal cash deposits during the demonetization period. Payment from SET Satellite (Singapore) P. ltd are not Taxable as ‘royalty’ under Article 12(2) of India-Singapore Treaty: ITAT The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the payments from the SET Satellite (Singapore) Pte Ltd are not taxable as royalty under Article 12(2) of the India-Singapore Treaty.

The Bench of  Kavitha Rajagopal (Judicial) and Om Prakash Kant (Accountant )observed that the assessee was eligible to claim the benefit of the India-Singapore treaty the payment from SET Satellite (Singapore) Pte. Ltd. is not taxable as ‘royalty’ under Article 12(2) of the India-Singapore treaty and the payments from the Broadcasting Corporation of India and Prasar Bharati All India Radio are to be treated as ‘royalties’ and 50% of the payment received from LG, Hero Honda, and Hutchison for the use of trademarks, trade names, and copy rights are to be taxable as ‘royalties’ under Article 12 and clause (3)(a) of the India-Singapore treaty ITAT quashes levy of Penalty u/s 271(1)(c) of Income Tax Act on ground of Absence of Proper Opportunity of Hearing Dy. CIT(IT) – 3(1) vs M/s. Global Cricket Corpn Pte Ltd The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) quashed the levy of penalty under section 271(1)(c ) of the Income Tax Act,1961 on the grounds of absence of proper opportunity of hearing. The bench of Kavitha Rajagopal (Judicial) and Om Prakash Kant (Accountant) observed that in the case of Mohd. Farhan A. Shaikh, the court held that the nonstriking on the irrelevant limb would vitiate the penalty proceedings in toto. Expenditure pertaining to Consultancy fees can be treated as Revenue Expenditure are eligible for deduction u/s. 37(1) of Income Tax Act: ITAT KMTC (India) Private Limited vs CIT(A)

The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the expenditure of consultancy fees can be treated as revenue expenditure and is eligible for the deduction under section 37 (1) of the Income Tax Act,1961. The bench of Kavitha Rajagopal (Judicial) and Prashant Maharishi (Accountant) the expenditure of consultancy fee had been treated as revenue expenditure which is eligible for deduction under section 37(1) of the Income Tax Act and the impugned expenditure will not come under the purview of section 35D of the Income Tax Act and rather would be a revenue expenditure allowable as deduction under section 37(1) of the Income Tax Act.

ITAT quashes Addition Made by AO on account of Capital Gain on ground of Wrongful Initiation of Proceedings u/s 148 of Income Tax Act M/s. Ickon Projects vs Income Tax Officer The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) quashed the addition made by the Assessing Officer (AO) on account of capital gain on the ground of wrongful initiation of proceedings under section 148 of the Income Tax Act,1961. The Bench ofMadhumita Roy (Judicial) and Chandra Poojari (Accountant) observed that the wrong initiation of proceeding by issuing notice under Section 148 of the Income Tax Act culminating into the order of addition under Section 147 of the Income Tax Act was, therefore, found to be without any jurisdiction ITAT directs Re-adjudication in respect of stamp duty valuation upon sale of inherited property to brother Ranjita Rangnath Mhatre vs Income-tax Officer The Income Tax Appellate Tribunal (ITAT), Mumbai bench, directed readjudication in respect of stamp duty valuation upon the sale of inherited property to the brother.

The tribunal observed that the assessing officer did not refer to the DVO and remitted the issue back for reconsideration. After reviewing facts and records, the two-member bench directed re adjudication of stamp duty valuation ITAT deletes addition made on account of notional ALV on unsold flats held as stock-in-trade M/s Runwal Constructions vs Dy.Commissioner of Income-tax The Income Tax Appellate Tribunal (ITAT), Mumbai bench, deleted the addition made on account of the notional Annual Letting Value (ALV) on unsold flats held as stock-in-trade. The bench observed that the unsold flats were its stock-in-trade, and income arising on their sale is liable to be taxed as business income. The two-member bench of Rajesh Kumar (Accountant Member) and Saktijit Dey (Judicial Member)observed that unsold flats, considered stock-in-trade, are assessable under the head ‘income from business’ when sold.

Therefore, the assessing officer was incorrect in taxing the notional annual letting value under the head ‘income from house property.’ Compensation paid  for closure of agreement entered with Private Company in Real Estate Development Business is allowable expenditure: ITAT DCIT, Cir-14(3)(2) vs Sentinel Properties Pv t. Ltd The Income Tax Appellate Tribunal (ITAT), Mumbai bench, held that compensation paid for the closure of agreements entered with private companies in the real estate development business is allowable expenditure. two-member bench of Prashant Maharishi (Accountant Member) and Sandeep Singh Karhail (Judicial Member) of tribunal observed that the assessee and the company to whom compensation was paid are not related parties either under the Companies Act or under the Income Tax Act, as they have not disclosed each other in the related party disclosures in their annual accounts and tax audit report.

Addition u/s 69 made due to Unavailability of Transaction Information: ITAT grants final Opportunity for Non-Compliance Devang Jitendra Mashru vs Income Tax Officer The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) granted a final opportunity to the assessee for non-compliance even after the appellate stage due to an addition under Section 69 of the Income Tax Act, 1961 made due to unavailability of transaction information. the Two-member bench comprising of Aby T Varkey (Judicial member) and Padmavathy S. (Accountant member) held that the additions made by the Assessing Officer are based on information from the Intelligent Transport System (ITS) data and due to lack of details the assessing officer has treated the entire income from sale of property as unexplained.

Deduction u/s 115JB shall be allowed when Farmer and Trade Advances are actually Written off in Books of Account: ITAT Global Green Company Ltd. vs DCIT The Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that the deduction under Section 115JB of the Income Tax Act, 1961 shall be allowed when the farmer and trade advances are actually written off in the books of accounts. The Two-member bench comprising of Saktijit Dey (Vice-President) and B.R.R. Kumar (Accountant member) directed the Assessing Officer to factually verify the assessee’s claim in case it was found that the assessee had actually written off the farmer advances, trade advances, and doubtful debts in the books, they have to be allowed as deduction while computing book profit under Section 115JB of the Income Tax Act. Employee’s contribution to PF & ESIC shall not be allowed deduction when Deposited belatedly after Due date and before filling ITR: ITAT KMTC (India) Private Limited vs CIT(A) The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the employee’s contribution to Provident Fund (PF) and Employee State Insurance Corporation (ESIC) shall not be allowed deduction when deposited belatedly after the due date and before filling of the Income Tax Return (ITR).

The Two-member bench comprising of Prashant Maharishi (Accountant member) and Kavitha Rajagopal (Judicial member) held that the employee’s contribution to PF & ESIC having been deposited belatedly after the due date prescribed under the relevant acts, nevertheless before the filing of the return of income was not an allowable deduction as per the recent decision of the Supreme Court in the case of Checkmate Services P. Ltd. Books of Account can’t be held incorrect merely due to an Inadvertent mistake in TAR which is supported by Affidavit of Auditor: ITAT ITO-22(3)(6) vs Sambhav Shelter The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the books of account cannot be held incorrect merely due to an inadvertent mistake in the Tax Audit Report (TAR) which is also supported by an affidavit of the auditor The Two-member bench comprising of Aby T. Varkey (Judicial member) and Amarjit Singh (Accountant member) held that the action of the Assessing Officer to reject the books cannot be accepted and the CIT(A) has rightly reversed his action on this issue and accepted the books of account of the assessee.

Thus, the order of the CIT(A) was upheld and the appeal of the revenue was dismissed. Depository Charges should not be Disallowed u/s 14A r.w.r. 8D(2)(i) of Income Tax Act: ITAT DAM Capital Advisors Limited vs DCIT The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the depositary charges should not be disallowed under section 14A read with rule 8D(2)(i) of the Income Tax Act,1961. The two-member bench comprising Amit Shukla (Judicial) and Padmavathy (Accountant) held that the investments that are yielding exempt income only should be considered for disallowance and remanded the matter back to the assessing officer for re-computation of disallowance.  To Read the full text of the Order CLICK HERE ITAT quashes Addition by AO towards Business Loss on ground of Absence of Speculation Loss of Share Capital Income The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) quashed the addition made by the Assessing Officer (AO) towards the business loss on the grounds of the absence of speculation of loss of share capital income.

The two-member bench comprising Amit Shukla (Judicial) and Padmavathy (Accountant) observed that the assessee was not deriving any income out of share trading that was speculative and, therefore, the finding given by the lower authority stating that the assessee was involved in speculation was factually incorrect. No computation of fee u/s.234E of Income Tax Act for Delayed filing of return of TDS prior to 01.06.2015: ITAT Sri Channabasaveshwara Swamy Rural Education Society vs The Income Tax Officer The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) held that the computation of fee under section 234E of the Income Tax Act,1961 cannot be done for delayed filing of return of Tax Deducted at Source (TDS) before the period of 01.06.2015.

The Benc two-member bench comprising Beena Pillai (Judicial) and Laxmi Prasad Sahu (Accountant) in the case of Fatehraj Singhvi v. UOI, Karnataka High Court held that amendment made under section 200A of the Income Tax Act providing that fee under section 234E of the Income Tax Act could be computed at the time of processing of return and issue of intimation has come into effect only from 1.6.2015 and had only prospective effect and therefore, no computation of fee under section 234E of the Income Tax Act for delayed filing of return of TDS while processing a return of TDS could have been made for tax deducted at source for the assessment years before 1.6.2015. Determination of ALP of Professional Fee should not be carried out by AO in a case where reference is not made to TPO: ITAT Deletes Addition towards transfer pricing adjustment The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the determination of Arms Length Price (ALP) of professional fee should not be carried out by the Assessing Officer (AO) in a case where the reference made to the Transfer Pricing Officer (TPO).

The Bench observed that the Central Board of Direct Taxes, vide instruction no.3/2016 dated 10th March 2016 had issued Guidelines for Implementation of Transfer Pricing Provisions and the assessing officer does not have the jurisdiction to propose any transfer pricing adjustment in case where he had not made any reference to the TPO. Therefore the additional made by the assessing officer to the tune of Rs.2,87,62,981 towards transfer pricing adjustment was not legally sustainable.

Provisions of sections 115BBE will not be applied on Surrendered Income which cannot be treated as unexplained money u/s 69A of Income Tax Act: ITAT DCIT vs Tapesh Tyagi The Income Tax Appellate Tribunal (ITAT), Delhi bench, held that provisions of Section 115BBE would not be applied to surrendered income, which could not be treated as unexplained money under Section 69A of the Income Tax Act, 1961. the two-member bench of Dr. B.R.R. Kumar (Accountant member) and Saktijit Dey (Vice-President) held that provisions of Section 115BBE would not be applied to surrendered income not treated as unexplained money under Section 69A.

Therefore, the bench dismissed the appeal of the revenue. Finance cost should be Allowed as a Deduction u/s 36(1)(iii) of Income Tax Act: ITAT DAM Capital Advisors Limited vs DCIT The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the finance cost should be allowed as a deduction under section 36(1)(iii) of the Income TDAM Capital Advisors Limited vs DCIT The two-member bench comprising Amit Shukla (Judicial) and Padmavathy (Accountant)observed that the claim of finance charges was made against the business income of the assessee from the broking business and, therefore, there was no question of triggering disallowance and finance cost should be allowed as a deduction under section 36(1)(iii) of Income Tax Act.

AO’s failure to conduct Independent Enquiry in respect of deposit in bank account for issuance of Demand Draft in favour of Indian Oil Corporation: ITAT deletes  addition Rajesh Singh A. Rajput vs I.T.O The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench, while deleting the addition made by the Assessing Officer (AO), held that the AO failed to conduct an independent inquiry in respect of the deposit in the bank account of the assessee for the issuance of a demand draft in favor of Indian Oil Corporation. Two-member bench of Waseem Ahmed (Accountant Member) and Ms. Madhumita Roy (Judicial Member) deleted the addition made by the assessing officer in respect of the cash deposit due to the failure to make an independent inquiry. ITAT deletes assessment order passed u/s 153A of Income Tax Act against non existent partnership firm Trishul Buildtech Infrastructure (P) Ltd vs The Joint Commissioner of Income Tax (OSD) The Income Tax Appellate Tribunal (ITAT), Bangalore bench, deleted the assessment order passed under Section 153A of the Income Tax Act, 1961, against a non-existent partnership firm. The two-member bench, consisting of Chandra Poojari (Accountant Member) and Madhumita Roy (Judicial Member),observed that assessment orders are framed by the  AO against the non-existing entity despite having knowledge of the fact that the partnership firm is fully taken over by M/s. Trishul Buildtech Infrastructure Pvt. Ltd.

Therefore  complete failure by the  AO to bring on record the successor in interest, so as to pass assessment orders in the name of new entity i.e. Trishul Buildtech Infrastructure Pvt. Ltd. Delay of Filing Appeal can be Condoned when there is sufficient cause for not filing appeal within period of limitation: ITAT condones delay of 438 days Sri Channabasaveshwara Swamy Rural Education Society vs The Income Tax Officer The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) held that the delay of filing an appeal can be condoned when there was any sufficient and reasonable cause on the part of the assessee for not filing the appeal within the period of limitation.

The two-member bench comprising Beena Pillai (Judicial) and Laxmi Prasad Sahu (Accountant) held that if the application of the assessee for condoning the delay is rejected, it would amount to legalizing injustice on technical grounds, when the Tribunal was capable of removing injustice and to do justice. Therefore, the delay of 438 days deserved to be condoned. Addition made u/s69 of Income Tax Act towards Purchase and Sale of Shares without Sufficient Evidence: ITAT Directs Re-adjudication Devang Jitendra Mashru vs Income Tax Officer-19(1)(4) Mumbai The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) directed the Assessing Officer (AO) for re-adjudication of additions made under section 69 of the Income Tax Act,1961 towards the purchase and sale of shares without sufficient evidence.

The two-member bench comprising Abt T Varkey (Judicial) and Padmavathy (Accountant) remanded the matter back to the Commissioner for considering the facts of the case and in the interest of justice and fair play and for giving one final opportunity to the assessee. No Weighted Average Cost of Capital method can be applied for purpose of computing ALP of Royalty income: ITAT Upholds Deletion of Adjustments in favour of Britannia Industries Assistant Commissioner of Income Tax vs M/s. Britannia Industries The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) upheld the deletion of adjustments in favor of Britannia Industries and held that the weighted average cost of capital (WACC) method cannot be applied for computing Arms Length Price (ALP) of royalty income.

Sonjoy Sarma (Judicial) and Manish Borad (Accountant) observed that the Weighted Average Cost of Capital (WACC) method should not be applied for computing ALP of royalty income and the brand value needs consistent research and development and regular investment because a mistake at any point in time could reduce the value of a brand drastically. Relief to Britannia Industries: ITAT Allows claim of Deduction for Lease Premium on ground of Absence of Capital Expenditure Assistant Commissioner of Income Tax vs M/s. Britannia Industries The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) granted relief to Britannia Industries by allowing the claim of deduction for lease premium on the ground of the absence of capital expenditure.

The tribunal of Sonjay Sarma (Judicial) and Manish Borad (Accountant) held that the assessee was eligible for the claim and directed the Assessing Officer to allow the claim of deduction for lease premium of Rs. 33,00,000/- for Assessment Year 2014-15. Rates for power made available through Indian Energy Exchange are not applicable to consumers; rather, they are rates to DISCOM: ITAT deletes TP Adjustment against Tata Steel The Income Tax Appellate Tribunal (ITAT), Mumbai bench, held that rates for power made available through the Indian Energy Exchange are not applicable to consumers; instead, they are rates for DISCOM. Consequently, the bench deleted the Transfer Pricing (TP) adjustment made against Tata Steel.

The tribunal of  two-member bench of Ms. Padmavathy S (Accountant Member) and Amit Shukla (Judicial Member) deleted the transfer pricing adjustment, stating that rates for power made available through the Indian Energy Exchange are not applicable to consumers but are rates for DISCOM. Consequently, the bench allowed the appeal of the assessee. Deduction u/s 80IA shall be allowed as Air Cargo Handling Services fall within Scope of Infrastructure facility: ITAT grants relief to Air India Airport Services ACIT, Circle-2(1), New Delhi vs M/s Air India SATS Airport Services Pvt. Ltd The Delhi bench of the Income Tax Appellate Tribunal (ITAT) granted relief to Air India Airport Services and held that deduction under Section 80IA of the Income Tax Act, 1961 shall be allowed as air cargo handling services fall within the scope of infrastructure facility.

The Two-member bench comprising of M. Balaganesh (Accountant member) and Anubhav Sharma (Judicial member) held that ground handling and cargo handling services provided by the assessee are covered within the meaning of the Explanation referred to Section 80-IA of the Income Tax Act and the assessee was entitled to claim the benefit of same.

Thus, the appeal of the assessee was allowed. CPC can’t make an Addition u/s 50C of Income Tax Act without giving proper opportunity to Assessee: ITAT Prabha Anil Gandhi vs ADIT The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the Centralized Processing Centre (CPC) cannot make an addition under Section 50C of the Income Tax Act, 1961 without giving a proper opportunity to the assessee.

The Two-member bench comprising of Kuldip Singh (Judicial member) and S. Rifaur Rahman (Accountant member) held that the proposed addition under Section 50C of the Income Tax Axt was beyond the mandate under Section 143(1) and the same can be processed only under Section 143(3) of the Income Tax Act. Addition shall not be sustained solely on basis of AIR information and when Receipt declared by Assessee far exceeds the Amount: ITAT Bona Sera Hospitality Pvt. Ltd vs DCIT The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that addition shall not be sustained on the basis of Annual Information Return (AIR) information and when the receipt declared by the assessee far exceeds the amount mentioned in the information.

The Two-member bench comprising of Aby T Varkey (Judicial member) and Amarjit Singh (Accountant member) held that “the additions were made solely on the basis of AIR information, especially in the absence of full details of parties and when the receipts declared by the assessee far exceeds the amount mentioned in the AIR information, was not sustainable in the eyes of law”.

Pass Through Cost directly  relatable to Advertisement & Publicity, Business Promotion and participation in trade events are excluded from cost base :ITAT Grants relief to BBC World ACIT vs M/s. BBC World (India) Pvt.Ltd The Income Tax Appellate Tribunal (ITAT),Delhi Bench while granting relief to BBC World (India) held that pass-through cost directly relatable to advertisement & publicity, business promotion and participation in trade events  are  excluded from the cost base.

The two-member bench of   Shamim Yahya (Accountant Member) and  Astha Chandra, (Judicial Member) held that pass-through cost directly relatable to advertisement & publicity, business  promotion and participation in trade events  are  excluded from the cost base.

Unsold flats categorized as Stock in Trade should be assessed as ‘Business Income,’ not ‘Income from House Property: ITAT quashes Revision Order M/s. Coronate Constructions vs PCIT The Income Tax Appellate Tribunal (ITAT), Mumbai bench, while quashing the revision order, held that unsold flats categorized as stock in trade should be assessed as business income, not income from house property. The two-member bench of S Rafiur Rahman (Accountant Member) and Kuldip Singh (Judicial Member) held that unsold flats, which are in stock in trade, should be assessed under the head “business income.”

Therefore, the bench allowed the appeal of the assessee. Anonymous Donations received by Trusts carrying on religious and charitable activities approved u/s 10(23C)(v) of Income Tax Act eligible for benefit of exclusion in Section 115BBC(2)(b) of IT Act: ITAT DCIT vs Shree Sai Baba Sansthan Trust The Income Tax Appellate Tribunal (ITAT), Mumbai bench, held that anonymous donations received by trusts carrying on religious and charitable activities, approved under Section 10(23C)(v) of the Income Tax Act, are eligible for the benefit of exclusion in Section 115BBC(2)(b) of the Income Tax Act, 1961. The bench concluded that trusts with dual purposes, having religious expenditure below 5% of total expenses, could be eligible for Section 80G certification and exempt from tax on anonymous donations under Section 115BBC(2)(b) of the Income Tax Act.

Cash deposited in name of various proprietorship concerns involving in bogus business activities: ITAT directs to restrict addition to extent of 0.05% of gross total RajendraGokuldas Parekh vs ITO The Income Tax Appellate Tribunal (ITAT), Mumbai bench, while directing to restrict the addition to the extent of 0.05% of gross total, observed that cash deposited in the name of various proprietorship concerns involved in bogus business activities. the two-member bench of Amarjit Singh (Accountant Member) and Kuldip Singh (Judicial Member) restricted the addition to the extent of 0.05% of the gross total of Rs. 76,55,523/- because actually, the business was run and controlled by the employer of the assessee, and the assessee had already shown the commission income received from the employer in the return filed.

No Disallowance shall be made u/s 14A of Income Tax Act when assessee have own funds more than Investments earning Exempt Income: ITAT grants relief to macro tech Developers Deputy Commissioner of Income tax vs M/s Macrotech Developers Limited The Income Tax Appellate Tribunal (ITAT), Mumbai bench held that no disallowance should be made under Section 14A of the Income Tax Act, 1961, when assessees have their own funds exceeding investments earning exempt income. The bench granted relief to Macrotech Developers.

The two-member bench, consisting of Ms. Padmavathy S (Accountant Member) and Kuldip Singh (Judicial Member), concluded that no disallowance should be made under Section 14A of the Income Tax Act, 1961.

The bench dismissed the revenue’s appeal. No investment made outside  books of Accounts: ITAT deletes Income Tax Addition ITO vs Direct Trading Co. P. Ld The Income Tax Appellate Tribunal (ITAT), Delhi bench, while deleting the Income Tax Addition, held that no investment has been made by the assessee outside the books of account. the two-member bench of M. Balaganesh (Accountant Member) and Anubhav Sharma (Judicial Member) deleted the Income Tax addition because no investment has been made by the assessee outside the books of account

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