Do you think that the tax news in simple language are better? Can you write them in simple language? and then broadcast? Then Write them at shocks n mocks.
After assessment was completed, AO noticed deposits in assessee’s bank account and sought to know source. Assessee stated they were refund for booking a flat, and Rs. 5,38,854 was interest returned. Assessee offered it to tax. AO added the sum. AO levied penalty for furnishing inaccurate particulars of income. CIT(A) directed penalty at Rs 1,25,306 instead of Rs 1,45,906. ITAT held that assessee had concealed income and penalty was justified.Login to write your news
Toshiba India Pvt Ltd filed itts tax return and disclosed international transactions with its AE. AO passed an order u/s 143(3) r.w.s 144C against the assessee on issue of distributor expenses. The matter reached the High Court, which remanded it to Tribunal. ITAT held that issue on quantification was not addressed by DRP as it was rejected on first principles itself. It remanded the issue to TPO to be addressed on facts.Login to write your news
A survey u/s 133A was conducted in Mukut Mahal Banquet Pvt Ltd’s premises. It filed its return of income. AO recorded statement of 6 parties behind assessee’s back. AO completed assessment after making various additions. CIT(A) partly allowed assessee’s appeal. ITAT deleted additions as they were explained by assessee, and payments made by 5 parties were made to service providers and not to assessee.Login to write your news
Assessee’s assessment was reopened to seek explaination of purchase of bonds for Rs 5 lacs. Assessee submitted it was from sale proceeds of jewellery, and submitted bill of jeweller. AO issued notice u/s 133(6) to jeweller, but it came back unserved. AO concluded that claim was not genuine. AO made addition. CIT(A) allowed relief to assessee. ITAT held that CIT(A) had adjudicated by accepting fresh evidence. It upheld CIT(A)’s order.Login to write your news
Primary Real Estate Pvt Ltd incurred travelling expenses. AO disallowed 40% of expenditure as non-business expenses, as details were not provided. Assessee claimed payment of commission of Rs 15 lakhs to its director. AO disallowed increase of Rs 5 lakhs u/s 37(1) r.w.s. 40(2)(b), holding that turnover had not increased. CIT(A) restricted expenditure to 20%, and confirmed disallowance. ITAT allowed expenditure and deleted disallowance.Login to write your news
Assessee, an investor and trader in shares, earned profit on share trading and claimed LTCG instead of treating it as business income. AO levied penalty u/s 271(1)(c) for furnishing inaccurate particulars of income. CIT(A) allowed assessee’s appeal. ITAT held that there was no basis to treat assessee as trader in shares, and AO was not justified in treating capital gain as business income. ITAT upheld CIT(A)’s order.Login to write your news
AO noted that Synergy Lifestyle Pvt Ltd had received dividend income of Rs.23,72,210 which was claimed as exempt. AO treated same as business income. The matter travelled to Tribunal which directed AO to treat dividend income as exempt u/s 10(34)/(35). AO computed disallowance u/s 14A r.w. Rule 8D at Rs.7,34,274. CIT(A) restricted disallowance at Rs.1,32,609. ITAT upheld disallowance which it considered as reasonable.Login to write your news
Assessee submitted his 'block return' declaring income, including Rs 30 lakhs as 'undisclosed income' on account of inflated labour expenses. AO estimated inflation and salary payment @ 5% as ad-hoc addition to work out undisclosed income. AO levied penalty u/s 158BFA(2). CIT(A) partly sustained undisclosed income, worked out inflated expenses at 3.7%, an deleted penalty for sums over Rs 30 lakhs. ITAT upheld deletion of penalty.Login to write your news
Assessee declared total income of Rs 16,96,974, from 'salary', 'income from house property' and 'income from other sources'. AO noted that assessee had taken huge loans and advances from various companies, and AO treated them as 'income from other sources' by treating it as 'deemed dividend', u/s 2(22)(e). AO imposed penalty. CIT(A) confirmed penalty. ITAT deleted penalty as assessee had disclosed loans and advances.Login to write your news
Premier Finance and Trading Co filed its return of income. AO made additions on account of grant of interest free advances to various parties, out of interest bearing loans, and share application money, and u/s 14A. CIT(A) deleted additions without giving any proper finding. ITAT restored the matter to CIT(A) to decide afresh.Login to write your news
Assessee had shown purchases of Rs 64,70,932 and sundry creditors at Rs. 40,22,864. To verify their genuineness, AO issued letters to some parties u/s 133(6). Some letters were returned unserved. AO made addition on unproved/inflated purchases, and on account of cessation of liability u/s 41(1) in case of one party. CIT(A) confirmed additions. ITAT restored the matter to AO to consider additional evidence filed by assessee.Login to write your news
Assessee was into arranging seminars etc. It had shown unsecured loans of Rs. 32.13 lakhs, and could furnish details of unsecured loans of Rs 23,64,500. AO made addition of sum which was unproved. Assessee had purchased a car and made downpayment, which was not explained. AO made addition u/s 68. CIT(A) deleted first addition, and confirmed second addition. ITAT deleted addition u/s 68 holding it was fully explained.Login to write your news
Assessee’s return was processed u/s 143(1). Subsequently, in assessee’s search, assessee’s undisclosed bank accounts were detected with unexplained cash. AO reopened assessment. Assessee replied he had already filed return admitting the additional income. AO completed assessment, and imposed penalty. CIT(A) sustained penalty. ITAT upheld penalty as it was levied with reference to original return of income, and not consequent to disclosure.
DQ Entertainment (International) Ltd’s reported international transactions with its AE. TPO held assessee could not prove services rendered by AE. TPO determined ALP at NIL and made addition of management consultancy fees paid to AE. DRP remanded issue to TPO, who passed the same order. ITAT held that since services had been rendered, ALP cannot be take at NIL. It allowed the management consultancy fees.
CIT(A) sent four notices to the assessee. CIT(A) passed ex-parte orders in appeals arising u/s 143(3)/153A. The ITAT held that while deciding the appeals, CIT(A) had not followed mandatory provisions, of first setting out points for determination and thereafter drawing reasons conclusions to be brought on record. Thus ITAT restored the matter to CIT(A) with the direction to pass a speaking order in accordance with law.
In Treadstone International’s case, AO made an addition of Rs.36,92,935 on account of cash purchase of raw hide, u/s 40A(3). CIT(A) deleted the addition. ITAT held that payments for purchase of produces of animal husbandry were made to producer through commission agent. Thus rule 40A(3) cannot be invoked as it comes under exemption of rule 6DD(e).
M/s J.K. Cement was granted 5% interest subsidy and 50% exemption from electricity duty by Rajasthan Government. Assesse declared exemption on electricity duty as revenue receipt, and interest subsidy as capital receipt, utilized by assessee in payment of loan taken from financial institutions. AO treated interest subsidy as revenue receipt and made addition. CIT(A) treated it as capital subsidy and deleted addition. ITAT upheld CIT(A)’s order.
Ashiana Ispat Ltd was into manufacturing and trading of TMT bars and MS ingots. It claimed expenses under brokerage and commission at Rs. 95,44,810. AO asked it to produce commission agents for examination.Assessee did not produce any commission agent. AO disallowed commission. CIT(A) deleted the addition. ITAT held that books of account had been accepted, and thus allowed commission as expenses incurred for business purpose.Case Law,Dec. 18, 2017
Assessee filed two miscellaneous applications against ITAT’s order, contending that transactions entered in regular Books of Account cannot be subject matter for addition in block period assessments. Assessee submitted that issue was not considered. ITAT recalled the appeals to consider the grounds afresh.
Assessee, proprietor of M/s Heeralal Chaganlal Tank, filed its return of income at Rs 19,55,434. AO held that assessee’s stock register was not verifiable. AO noticed that assessee had made purchases, which were held to be non-genuine purchases. AO disallowed 25% of unverifiable purchases and made addition. CIT(A) confirmed addition of Rs 1 lakh. ITAT directed AO to recalculate income by disallowing 15% of unverifiable purchases.
M/s Rochi Ram and Sons filed return of income declaring income of Rs. 38,81,914. AO noticed PF and ESI contribution were deposited by assessee after due date. AO u/s 43B r.w s 36(1)(va) disallowed the contribution made by assessee and made addition. CIT(A) deleted addition. ITAT upheld CIT(A)’s order.
Friends International was in business of precious and semi precious stones. It filed its return declaring total income of Rs 18,08,070. AO u/s 145(3) rejected books of accounts. AO held that purchases from various parties for Rs. 30,96,965 could not be verified. AO disallowed 25% of unverifiable purchases and made addition. CIT(A) upheld AO’s action. ITAT directed AO to recalculate income by disallowing 15% of unverifiable purchases.Case Law,Dec. 18, 2017