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DATE: May 25, 2015 (Date of pronouncement)
DATE: May 27, 2015 (Date of publication)
AY: 2007-08 to 2010-11
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CITATION:
ITAT laments non-representation/ inept-representation of matters before it by the Revenue. Suggests guidelines to remedy the state of affairs

it is noticed that some of the DRs had never had exposure to the functions of the Tribunal except the formal court observation as part of their training programme, which sometimes result in not supporting the stand of the Revenue effectively and in turn may affect a genuine case of the Revenue for want of proper prosecution. We would take this opportunity to suggest that any official, on being assigned the duty of DR, should be made to sit in the court room for observation at least for 15 days so that their services can be used effectively at a later stage.

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DATE: April 8, 2015 (Date of pronouncement)
DATE: April 24, 2015 (Date of publication)
AY: 2009-10
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CITATION:
S. 271(1)(c): Surrender of income after questionnaire does not mean it is not voluntary. If surrender is on condition of no penalty and assessment is based only on surrender and not on evidence, penalty cannot be levied

At the time of surrender itself contention of not initiating any penalty proceedings was there. No additional matter was discovered to prove that there was concealment of income. The AO has included the amount of share capital in the total income of assessee merely on the basis of assessee’s declaration/surrender. The AO did not point out or refer any evidence or material to show that the amount of share capital received by the assessee was bogus. It is also not the case of the revenue that material was found at the assessee’s premises to indicate that share application money received was an arranged affair to accommodate assessee’s unaccounted money. Thus there was no detection by the AO that share capital was not genuine. The surrender of share capital after issue of the notice u/s.143(2) could not lead to any inference that it was not voluntary.

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DATE: April 10, 2015 (Date of pronouncement)
DATE: April 24, 2015 (Date of publication)
AY: 2009-10
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CITATION:
Additions made solely on the basis of AIR information are not sustainable in the eyes of law if the Revenue has not made any enquires to find out whether the AIR information was correct or not

It has been held time and again by this Tribunal that the additions made solely on the basis of AIR information are not sustainable in the eyes of law. If the assessee denies that it is in receipt of income from a particular source, it is for the AO to prove that the assessee has received income as the assessee cannot prove the negative

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DATE: March 4, 2015 (Date of pronouncement)
DATE: March 31, 2015 (Date of publication)
AY: 2005-06, 2006-07
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CITATION:
S. 40(a)(ia): Merilyn Shipping 136 ITD 23 (SB) should be followed in view of approval by Allahabad HC and dismissal of SLP by Supreme Court. In any event as two views are possible, view in favour of assessee should be followed. Amounts already paid without TDS cannot be disallowed

Though there are contrary decisions of the other Hon’ble High Courts, i.e. Hon’ble Calcutta High Court and Hon’ble Gujarat High Court, in the light of the decision of the Hon’ble Allabahad High Court it can be said the there can be two views possible in this matter in which event the one which is in favour of the assessee has to be followed in the light of the decision of the Hon’ble Supreme Court in the case of Vegetable Products Ltd. 88 ITR 192

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DATE: March 11, 2015 (Date of pronouncement)
DATE: March 23, 2015 (Date of publication)
AY: 2009-10
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CITATION:
Companies, if authorized by the MoA & AoA, are competent to make and receive gifts. Natural love and affection is a not necessary requirement for a gift. The gift is neither taxable as income s. 56 (pre-amendment) nor as capital gain nor as income u/s.2(22)(e) nor u/s.115JB

Three elements are essential in determining whether or not a gift has been made, a) delivery. b) donative intent,’ and c) acceptance by the donee. Companies are competent to make and receive gifts and natural love and affection are not necessary requirement. Only requirement for company is to make gifts as per respective memorandum and article of association, which authorize the company for the same

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DATE: February 25, 2015 (Date of pronouncement)
DATE: March 9, 2015 (Date of publication)
AY: 2008-09
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CITATION:
S. 2(47)(v)/(vi): Land ceases to be a capital asset on date of application for conversion into N. A. land. Pursuant to amendment to s. 53A of TOP Act , non-registered development agreement does not result in transfer u/s 2(47)(v). Law in Chaturbhuj Dwarkadas Kapadia 260 ITR 491 (Bom) does not apply after amendment to s. 53A

As provisions of section 53A was amended in 2001 by which additional condition of registration of the written agreement was introduced and since in the instant case the agreement was not registered, the decision rendered by Hon’ble Bombay High Court in the case of Chaturbhuj Dwarkadas Kapadia 260 ITR 491 with respect to relevant provisions of section 53A applicable in A.Y. 1996-97 will not be applicable to the facts of instant case

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DATE: January 2, 2015 (Date of pronouncement)
DATE: February 13, 2015 (Date of publication)
AY: 2003-04
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CITATION:
S. 147/151: Non-mentioning in the reasons that approval has been obtained from the CIT vitiates the reopening

Another major discrepancy noticed during the course of arguments is that there is no mention of authorization of a higher authority to initiate the current reassessment proceedings. Since there is no mention of the approval sought from the CIT on the reasons, as recorded by the AO to initiate reassessment proceedings, the entire initiation has been vitiated and become bad in law

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DATE: January 9, 2015 (Date of pronouncement)
DATE: January 12, 2015 (Date of publication)
AY: 2009-10
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CITATION:
Transfer Pricing: Law on making adjustments for 'risk' and 'location savings' explained

The arm’s length principle requires benchmarking to be done with comparables in the jurisdiction of tested party and the location savings, if any, would be reflected in the profitability earned by comparables which are used for benchmarking the international transactions. Thus in our view, no separate/additional allocation is called for on account of location savings

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DATE: December 5, 2014 (Date of pronouncement)
DATE: January 9, 2015 (Date of publication)
AY: 2007-08, 2008-09
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CITATION:
Bogus purchases: Merely because a party has admitted to indulging in sham/ accommodation transactions does not mean that all his transactions with the assessee should be treated as sham

We cannot accept a bald statement made by the AO that any transaction/business done with a party would be sham, simply because the opposite party besides doing regular business was also indulging in providing accommodation entries. Simply on the basis of statement given by the third party, that they were also providing accommodation entries as well, the conduct of the assessee cannot be doubted and held to be sham

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DATE: January 1, 2015 (Date of pronouncement)
DATE: January 7, 2015 (Date of publication)
AY: 2004-05
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CITATION:
S. 271(1)(c): If the High Court admits the appeal u/s 260A, it means that the issue is debatable and penalty cannot survive

When the Hon’ble jurisdictional High Court has admitted substantial question of law on the addition, it becomes apparent that the addition so made has become debatable. The penalty was imposed on the basis of addition so made, therefore, when the addition on the basis of which the penalty was imposed has become doubtful/debatable, therefore, penalty imposed u/s 271(1)(c) of the Act cannot survive

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