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ITAT - In absence of 'make available' under India-UK DTAA, provision of services in relation to inspection and survey of imported/exported cargo and certifying in relation to the quality and price, are not taxable.
Inspectorate International Ltd. Vs. ACIT
(2018) TaxCorp(LJ) 15283 (ITAT-DELHI)
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ITAT - Foreign exchange fluctuation losses arising to PE on account of advance or loan received from HO towards working-capital requirement is allowed u/s 37(1).
Cobra Instalaciones Y Servicios SA Vs. DCIT
(2018) TaxCorp(LJ) 15280 (ITAT-DELHI)
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S. 68 Bogus share capital: If the AO has remained silent with folded hands and has not made any independent inquiry from the concerned AO of share holder company and has not controverted the evidence produced by the assessee, that itself is sufficient to knock off the addition made. The fact that there is no personal appearance from director of said cash creditor (share holder) does not mean that an adverse inference u/s 68 can be drawn by the AO without the AO discharging the secondary burden lying upon him (All imp judgements referred)
Moti Adhesives Pvt. Ltd. vs. ITO
(2018) TaxCorp(LJ) 15274 (ITAT-DELHI) · Section. 68
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Condonation of delay (92 days): The AO was negligent in filing the remand report before the CIT(A). The same attitude has continued at the stage of filing appeal to the ITAT. The excuse that the appeal was not filed due to the AO being busy with time barring assessment is not acceptable. The AO deliberately overlooked the impugned order and did not file appeal before the Tribunal within the period of limitation. Even the authorization by Pr. CIT to file the appeal has been granted after the period of limitation. Hence sufficient cause is not shown
ITO. Vs. Gisil Designs Pvt. Ltd.
(2018) TaxCorp(LJ) 15273 (ITAT-DELHI)
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ITAT - No addition u/s 68 on account of share premium received by assessee-company.
Vidya Prakashan Mandir Pvt. Ltd. Vs Pr.CIT
(2018) TaxCorp(LJ) 15239 (ITAT-DELHI)
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ITAT - There cannot be straightjacket formula for warranty provision in each industry alike and it may differ from industry to industry. Sets aside lower authorities order denying deduction for provision of warranty expenses.
Huawei Telecommunication (India) Company Pvt Ltd vs. ACIT
(2018) TaxCorp(LJ) 15231 (ITAT-DELHI)
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ITAT - Assessment made u/s. 143(3) r.w.s. 144C(13) on a foreign Company which had voluntarily wound up is not a nullity.
Pesak Ventures Ltd. vs. DCIT
(2018) TaxCorp(LJ) 15222 (ITAT-DELHI)
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S. 159/ 163/ 176: While a notice/ order on a dead person/ wound-up company is a nullity, this is subject to the condition that the department is made aware of the death/ winding-up. If the legal representative, either voluntarily or in response to a notice issued against the deceased but served upon his agent, allows the assessment proceedings to continue against the deceased/ wound-up company without any objection and lets the AO make an assessment order, it would not be open for him to take a plea at the appellate stage, as a last resort or as an afterthought, that the proceedings taken and the assessment order made against the deceased/ wound-up company are nullity. In such cases, the assessment is liable to be set-aside for a fresh assessment in accordance with law instead of its annulment
Pesak Ventures Ltd. vs. DCIT
(2018) TaxCorp(LJ) 15208 (ITAT-DELHI) · Sections. 159, 163, 176
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Applicability of s. 80 to s. 153A returns: A return filed u/s 153A is deemed to be a return filed u/s 139(1). Accordingly, the restrictive provisions of s. 80 do not apply. The return u/s 153A, once accepted and assessed, replaces the original return filed u/s 139. Therefore, the assessee is eligible for carry forward business loss
ACIT. Vs. Splendor Landbase Limited
(2018) TaxCorp(LJ) 15112 (ITAT-DELHI) · Section. 80 to 153A
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S. 44C: A non- resident assessee is entitled to claim deduction of an amount equal to 5% of the adjusted total income as expenditure in the nature of Head Office (HO) Expenses. The fact that the expenses are not debited in the Profit & loss account or the books of account is irrelevant. The entries in the books of account are not conclusive
Ernst & Young Ltd. vs. ACIT
(2018) TaxCorp(LJ) 15110 (ITAT-DELHI) · Section. 44C
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Entire law explained on (a) whether a subsidiary of a foreign company constitutes "business connection" and/ or "fixed Permanent Establishment" and/or "Dependent Agent Permanent Establishment" of assessee in India, (b) whether any attributes of profits on account of signing, network planning and negotiation of off-shore supply contracts in India could be attributed to such business connection/ permanent establishment and (c) whether notional interest on delayed consideration of supply of equipment and licensing of software taxable in the hands of assessee as interest from vendor financing
Nokia Networks OY vs. JCIT
(2018) TaxCorp(LJ) 15108 (ITAT-DELHI)
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S. 147/ 151: If the AO reopens on the basis of information received from another AO without further inquiry, it means he has proceeded "mechanically" and "without application of mind". If the CIT does not give reasons while according sanction, it implies that he has also not applied his mind. Both render the reopening void (All imp judgements referred)
Sunil Agarwal vs. ITO
(2018) TaxCorp(LJ) 15025 (ITAT-DELHI) · Sections. 147, 151
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S. 56(2)(viia)/ 47(iii): Capital gains on shares transferred via "Gift": Surprising that huge volume of shares in a public limited company is transferred by assessee to another company without any consideration, without any proper documentation being executed as per law and giving it a nomenclature of “gift”. Difficult to imagine Articles of Association of a company would provide for gifting of assets of the company to another company unless it be one which has been set up for some purpose. The assessee has to establish to the hilt, the factum, genuineness and validity of the transaction, the right to enter into such transaction and bonafides of such transaction, especially when, revenue challenges its genuineness. There is no agreement/document that has been executed between group companies forming part of family realignment. To postulate that a company can give away its assets free to another even orally, can only be aiding dubious attempts at avoidance of tax payable under the Act unless it is supported by documentary evidence
Gagan Infraenergy Ltd. Vs. DCIT
(2018) TaxCorp(LJ) 15021 (ITAT-DELHI) · Sections. 56(2)(viia), 47(iii)
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ITAT - Evaluation of LNG vaporizers is not FIS under India-US DTAA since US entity did not make available technical knowledge, skill, know-how etc. No disallowance u/s. 40(a)(i).
ACIT. Vs. Petronet LNG Ltd.
(2018) TaxCorp(LJ) 14859 (ITAT-DELHI)
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Transfer Pricing: The "international transaction" as defined in s. 92F(v) has to be a genuine transaction. Transfer pricing provisions do not apply to non-genuine or sham transactions
Mitchell Drilling India Private Limited vs. DCIT
(2018) TaxCorp(LJ) 14849 (ITAT-DELHI) · Section. 92F(v)
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S. 56(2)(viia)/ Rule 11UA: The "fair market value" of shares acquired has to be determined by the taking the book values of the underlying assets and not their market values
Minda SM Technocast Pvt. Ltd. vs. ACIT
(2018) TaxCorp(LJ) 14802 (ITAT-DELHI) · Section. 56(2)(viia)
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S. 147 Reopening: Passing the reassessment order before the expiry of 4 weeks of passing the order of objections renders the reassessment order void. Also, if the reasons state “bogus accommodation entries were provided/taken” and it is not clear whether the assessee has received or provided accommodation entries, it means there is no application of mind by the AO while recording reasons
Meta Plast Engineering P. Ltd. vs. ITO
(2018) TaxCorp(LJ) 14786 (ITAT-DELHI) · Section. 147
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S. 145(3): Entire law explained explained on whether if the AO rejects the books of account, he can rely on the entries in the books to make disallowances u/s 40A(3) and s. 68 and also make additions for "peak credit". All judgements on the point considered
Deepak Mittal vs. ACIT
(2018) TaxCorp(LJ) 14673 (ITAT-DELHI) · Section. 145(3)
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S. 9(1)(vi) Royalty: Domain name is an intangible asset which is similar to trademark. Consequently, income from services rendered in connection with such domain name registration is assessable as "royalty" u/s 9(1)(vi) of the Income-tax Act
Godaddy.com LLC vs. ACIT
(2018) TaxCorp(LJ) 14672 (ITAT-DELHI) · Section. 9(1)(vi)
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S. 68 Bogus share capital: The assessee set up a devise to introduce unaccounted money through various shell companies in the form of share capital at a premium. The manner of issue of the shares through these companies, the manner of providing confirmation on the letter pad, the manner of maintaining the annual accounts and the manner of submitting the bank accounts on the letter pad or on a computerized print out to give it a semblance of originality to defraud the revenue shows the whole picture how the accommodation entries are routed through shell companies as share capital to evade taxes
Shaan Construction P Ltd. vs. ITO
(2018) TaxCorp(LJ) 14653 (ITAT-DELHI) · Section. 68
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