ITAT Cases Weekly Round-Up: 28 April To 4 May 2024

Payments Received Towards Interconnectivity Utility Charges From Indian Customers Is Not Royalty: ITAT Case Title: M/s. KDDI Corporation Versus The Deputy Commissioner of Income Tax (International Taxation) The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) has held that payments received by the assessee towards interconnectivity utility charges from Indian customers or end users cannot be considered royalties to be brought to tax in India. Taxing Unsold Flats In Real Estate Business Applicable From AY 2018-19; ITAT Deletes Notional Rent Addition For AY 2014-15 Case Title: Mack Star Marketing Private Limited Versus National Faceless Appeal Centre The Mumbai Bench of Income Tax Appellate Tribunal (ITAT), while deleting the notional rent addition for AY 2014–15, held that taxing unsold flats in real estate business is applicable from AY 2018–19. Penalty Order On Ground Of Misreporting Of Income Not Justified When SCN And Assessment Order Alleged Under-Reporting: ITAT Case Title: Mohd. Sarwar Versus The Income Tax Officer The Hyderabad Bench of Income Tax Appellate Tribunal (ITAT) has held that the penalty order on the ground of misreporting of income was not justified when show cause notice and the assessment order alleged under-reporting. Assessee Has Incurred Expenses For Transfer As Per Scheme Of Arrangement Approved By NCLT; Mumbai ITAT Directs To Allow Stamp Duty & Registration Charges Case Title: Dy. Commissioner of Income Tax verses Larsen & Toubro Limited On finding that when the assessee has incurred the amount in question to complete the transfer as per the scheme of arrangement approved by the NCLT, without which the transfer could not have been effected, the Mumbai ITAT held that the CIT(A) has rightly and validly decided the issue in favour of the assessee and directed the AO to allow the stamp duty and registration charges after due verification. Assessee Has Not Benefited From Round-Tripping Of Share Transactions; Mumbai ITAT Deletes Addition U/s 68 Case Title: Lalwani Estates & Realtors Pvt Ltd. Verses Income Tax Officer On finding that the assessee has issued share application money and subsequently allotted shares which shows that the transactions are genuine and there is no material brought on record by tax authorities that the assessee has benefited from round-tripping, the Mumbai ITAT deleted the addition made u/s 68 of the Income Tax Act, 1961. Time Barred Appeal Is Not Maintainable In Absence Of Sufficient Cause For Condonation: Vishakhapatnam ITAT Case Title: Mahesh Gurram verses Income Tax Officer On finding that the assessee had neither substantiated his case before the Tribunal or before the CIT(A), theVisakhapatnam ITAT rejected the condonation and dismissed the appeal filed by the assessee in-limine. Payment Of Excessive Or Unreasonable Salary Is Sine Qua Non For Invoking Provision Of Sec 40A(2)(B): Ahmedabad ITAT Case Title: M S Hostel verses Deputy Commissioner of Income Tax On finding that none of the orders passed by I-T Authorities doubted the services so rendered by the administrative head nor alleged to have been paid salary excessive or unreasonable which is sine qua non in invoking the provision of Section 40A(2)(b) of the Income Tax Act, the Ahmedabad ITATallowed the deduction u/s 40A(2)(b). Mere Disallowance Of Expenditure Or Enhancement Of Returned Income Does Not Ipso Facto Call For Penalty U/s 271(1)(C): Delhi ITAT Case Title: Dion Global Solutions Limited verses ACIT While holding that mere disallowance of expenditure or enhancement of returned income does not ipso facto call for the imposition of penalty u/s 271(1)(c) of Income Tax Act, the Delhi ITAT deleted the said penalty. Bonafide Mistake Committed By Assessee While Applying For Registration In Form 10AB Instead Of Form 10A, Merits To Be Condoned: Hyderabad ITAT Case Title: Mandava Foundation verses Income Tax Officer On finding that it is proper to condone the mistake committed by the assessee while applying for registration in Form 10AB instead of Form 10A of the Income Tax Act, the Hyderabad ITAT directed the CIT(E) to hear and dispose of the request of the assessee by allowing it to apply under Form 10A. Deduction U/s 43B Shall Be Allowed If Assessee Has Claimed Such Deduction On Payment Basis: Rajkot ITAT Case Title: Maruti Enterprise verses ADIT The Rajkot ITAT held that the claim of the assessee cannot be denied as it was not reported in the tax audit report, especially in the circumstances where other evidence is available on record suggesting the deduction in pursuance to the provisions of section 43B on payment basis is available. Section 54F Does Not Envisage That Sale Consideration Obtained From Original Capital Asset Is Mandatorily Utilized For Meeting Cost Of New Asset: Delhi ITAT Case Title:...

ITAT Cases Weekly Round-Up: 28 April To 4 May 2024

Mariya Paliwala

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