Tax Cases Weekly Round-Up: 6 November to 12 November 2022

Delhi High CourtExpenses Towards Advertisement, Brokerage And Commission, Incurred By A Real Estate Developer; Deductible As Revenue Expenditure: Delhi High Court Case Title: Commissioner of Income Tax versus Somnath Buildtech Pvt. Ltd. Citation: 2022 LiveLaw (Del) 1048 The Delhi High Court has ruled that advertisement expenses, Software Developing Charges, and expenses towards brokerage and commission, incurred by a real estate developer, are in the nature of general administration cost and selling cost, as classified by the Guidance Note issued by the ICAI. Thus, they qualify for deduction as revenue expenditure. Reassessment Notice Based On Error Resulting From Oversight Of AO Is Not Valid: Delhi High Court Case Title: Deepak Kapoor Versus PCIT Citation: 2022 LiveLaw (Del) 1065 The Delhi High Court has held that the reassessment notice based on an error resulting from the oversight of the assessing officer is not valid. Delhi High Court Quashes Reassessment Order In The Name Of A Non-Existing Entity Case Title: Rajasthan Global Securities Private Limited Versus ACIT The Delhi High Court has quashed the reassessment order in the name of a non-existing entity. The division bench of Justice Vibhu Bakhru and Justice Amit Mahajan has observed that not only was the notice issued in the name of the transferor company but the order under Section 148A(d) of the Income Tax Act, as well as the notice under Section 148, have been issued on the PAN of the transferor company. Madras High Court Assessment Made To Best Of Judgment Of Authority Would Not Be Sufficient For Imposition Of Penalty: Madras High Court Case Title: N/s.Sayar Cars Versus The Appellate Deputy Commissioner (CT) The Madras High Court has held that the assessment made to the best of the authority's judgement would not be sufficient for the imposition of penalty, as the degree of proof required for the imposition of penalty is much higher than that required for the purpose of framing a best judgement assessment. Show Cause Notice Issued To The Driver Of Consignment Is Not Adequate: Madras High Court Case Title: Ramki Cements Private Limited Versus The State Tax Officer The Madras High Court has held that the show-cause notice issued to the driver of the consignment is not adequate. The single bench of Justice S. Srimathy has quashed the demand for tax and penalty in Form GST MOV-09 and directed the department to issue a fresh notice. Rajasthan High Court ITAT Is Last Fact Finding Authority And Bound To Follow Directions Issued By High Court in Pith and Substance: Rajasthan High Court Case Title: Pooja Agarwal Versus Commissioner of Income Tax-1 The Rajasthan High Court has held that the Income Tax Appellate Tribunal (ITAT) is the last fact-finding authority and is bound to follow the directions issued by the High Court in pith and substance. ITAT ITAT Restricts Addition To Estimated Profit Of 30% Of Cash Deposits Made During Demonetisation Period Case Title: Ms.Asokan Meena Versus ITO The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) has directed the AO to estimate a 30% net profit on total cash deposits made during the demonetization period and deleted the balance additions made under Section 69A of the Income Tax Act. Payment Made To Non-Resident Marketing Partners for Sale Services is FTS: ITAT Case Title: M/s.Sunsmart Technologies Pvt. Ltd. Versus The Asst. Commissioner of Income Tax The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) has held that payment made by the assessee to non-resident marketing partners for providing pre and post-sale services related to software solutions is in the nature of fees for technical services (FTS). Software Development Expenses For Rendering Services To Clients Is Revenue Expense: ITAT Case Title: Dy. Commissioner of Income Tax- 3(3)1) Versus M/s. Sikraft Infotech Private Limited The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has held that the software development expenses for rendering services to clients are revenue expenses. Assessee Proved Creditworthiness Of Loan Transactions: ITAT Deletes Addition Case Title: ITO Versus M/s KDG Projects Pvt. Ltd. The Kolkata Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the addition as the assessee proved the creditworthiness of loan transactions. CESTAT No Mala Fide Intent To Evade Service Tax: CESTAT Quashes Penalty Case Title: Dinesh Chandra Dubey Versus & Service Tax, Excise and Customs The Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has deleted the penalty and held that the service provider receiving a commission in lieu of providing "business auxiliary services" from Adarsh Credit Cooperative Society did not have a mala fide intention to evade service tax. No Service Tax Payable On Facility...

Tax Cases Weekly Round-Up: 6 November to 12 November 2022

Mariya Paliwala

Tags