ITAT weekly overview
This weekly roundup analytically summarizes key stories related to the Income Tax Appeal Tribunal (ITAT) reported on Taxscan.in during the previous week of October 25-30, 2021.
M / s Action Construction Equipments Ltd. DCIT
The Delhi Bench of the Income Tax Appeal Tribunal (ITAT) ruled that the penalty proceedings under Section 271 (1) (c) of the Income Tax Act, 1961 cannot be survived if the appraisal officer does not clearly state the reasons for the same under the conditions specified in the provision.
While removing the sanction procedure, the Tribunal ruled that “the assessment officer gave no reason why he abandoned the sanction for the 2010-2011 tax year and maintained the imposition of the sanction for the 2009-2010 tax year under the same set of facts. . Additionally, in the challenged sanction order, the assessor stated that the failure to file the appeal proves the assessor’s acceptance to provide / conceal income in the amount of Rs.15,964,494 / -. This This observation tends to show that the appraisal officer did not clarify the charge, whether it was providing inaccurate income information or concealing income. Therefore, looking at the facts in which the valuation officer under the same set of facts waived the penalty in the 2010-11 valuation year, therefore, this year’s penalty also cannot no longer be maintained, therefore deleted. “
DCIT vs. M / s Niyati Constructions
The Income Tax Appeal Tribunal (ITAT), seat of Ahmedabad, ruled that the amount of interest on SSNL term deposits / bonds would constitute business income and could be included in the calculation of remuneration of partners.
The two-member bench comprising Judicial Member Mr. Mahavir Prasad and Accountant Member Mr. Amarjith Singh was examining an appeal filed by the tax authorities against the appraised in which the First Appeals Authority struck down an order from the agent. appraisal rejecting Rs. 10 18,000 / – under section 40 (b) of the law as part of the partner’s remuneration on the grounds that the partner’s remuneration was not eligible on the amount of interest received on the deposit fixed / SSNL bonds which was treated as income from other sources.
ACIT vs. M / s Dong Woo Surface Tech India Pvt. Ltd.
The Chennai Bench of the Income Tax Appeal Tribunal (ITAT), while granting relief to Dong Woo Surface Tech India Pvt. Ltd., found that the monitoring fees they paid to its company mother must be deductible as an expense according to the income tax law.
ACIT vs. Ericsson
The Delhi Income Tax Appeal Tribunal (ITAT) ruled that no TDS is deductible in consideration for the use of software by resident Indian distributors to non-resident software manufacturers.
The coram of accountant member NKBillaiya and judicial member Amit Shukla estimated that the amounts paid by resident Indian end-users / distributors to non-resident computer software manufacturers / suppliers, in return for the resale / use of the computer software through the EULA / distribution agreements, is not the payment of royalties for the use of copyright in the computer software, and that the same does not give rise to any taxable income in India, as a result of which the persons concerned in Section 195 of the Income Tax Act were not required to deduct TDS under Section 195 of the Income Tax Act.
Nokia Sales India Pvt. Ltd vs. Addl. CIT
In a major relief to Nokia India, the Delhi Income Tax Appeal Tribunal (ITAT) removed the disallowance as the distributors provided the RTI and duly paid the tax. The coram of the judicial member, Amit Shukla and of the accountant member, Dr BRR Kumar, considered that the taxes had been duly collected by the State of the beneficiary and that any further action to recover them from the appraised would amount to a double taxation.
Confederation of Associations of Pharmaceutical Retailers Vs. CITER)
Raipur’s Income Tax Appeal Tribunal (ITAT) ruled that the mere rental of developed plots to members on the basis of contributions does not make the appraised, i.e. the Confederation associations of pharmaceutical dealers, ineligible for registration as a charitable entity.
The coram of judicial member Pawan Singh and accountant member Pradeep Kumar Kedia decided that the mere rental of developed plots to its members on the basis of their respective contributions does not render the appraised ineligible for registration as a charitable entity. in itself.
Sunrise Biscuit Co. Pvt. Ltd vs. ITO
In a major relief to Sunrise Biscuit, the Income Tax Appeal Tribunal (ITAT), Gauhati Bench ruled that the capital grant received by Assesee is likely to be excluded from the accounting profit calculation. The coram led by Vice President PM Jagtap and Judicial Member Aby T. Varkey authorized the grounds given by the appraisee and ordered the OA to deduct the VAT subsidy of Rs. 8,78,84,902 / – both when calculating income under the normal calculation provisions and accounting profit under article 115JB of the Law for the relevant YY 2014-15.
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