- CBDT Vide Circular No. 16/2023 dated 18.09.2023; Extends Due Date For Filing Of Form 10B/10BB and Form ITR-7 For Assessment Year 2023-24;
The due date of furnishing Audit reports in Form 10B/Form 10BB for the Financial Year 2022-23, which is 30-9-2023 has now been extended by the Central Board of Direct Taxes (CBDT) to 31-10-2023.
The due date of furnishing of Return of Income in Form ITR-7 for Assessment Year 2023-24, which is 31.10.2023 is also extended to 30-11-2023.
Important Judicial Precedents
- Whether since share premium received by assessee for valuation was found as per FMV, no addition is warranted u/s 56(2)(viib) – YES: ITAT
[2023-TIOL-1105-ITAT-DEL ITA No. 1412/Del/2020; AY: 2014-15 ITO, WARD 25(4), NEW DELHI Vs. TRIUMPH REALITY PVT LTD]
That the transaction relating to purchase and sale of shares is between a holding company and its subsidiary and no third party is involved. Therefore, no undue benefit has been derived by a third party. Even otherwise also, the Valuation of share as per DCF method has been determined by a registered valuer, which is in terms of section 56(2)(viib) rw Rule 11UA. Even, the alternative method adopted by the assessee for valuation of share was found as per FMV. The factual findings of the CIT(A) authority remain uncontroverted before us, as the Revenue has failed to bring on record any contrary material. Another pertinent fact, which the CIT(A) has rightly observed, is, the share application money was received in financial year 2012-13 and the terms and conditions of allotment were also decided in the said year. Therefore, no addition can be made in the impugned assessment year. Thus, for the said reasons, we do not find any merit in the ground raised. Accordingly, we uphold the decision of the CIT(A).
- Whether where reply filed assessee was not considered by AO before making assessment, there is breach of principles of natural justice – YES: HC
[2023-TIOL-1118-HC-DEL-IT_WP (C) 9444/2023 SUKHDEEP SINGH CHADHA
Vs. ASSESSMENT UNIT, INCOME TAX DEPARTMENT]
There was breach of principles of natural justice. Therefore, according to us, the best way forward would be to set aside the impugned assessment order of the AO. Liberty is, however, given to the AO to pass a fresh order, after taking into account the reply filed by the petitioner. Before passing the order, the AO will also accord personal hearing to the petitioner and/or his authorized representative. Needless to add, the AO will deal with all the contentions raised by the petitioner and thereafter pass a speaking order. It is made clear that the order passed today will not impact the merits of the case. The writ petition is disposed of, in the aforesaid terms.
- Whether ex party assessment as well as penalty for non-compliance of notice u/s 271(1)(b) is not sustainable – YES: ITAT
[2023-TIOL-1113-ITAT-JAIPUR _ITA No. 243/JP/2022 KUSUM MITTAL Vs. INCOME TAX OFFICER,]
Since the assessee has filed an Affidavit coupled with report from the Income Tax Department in order to prove that service of notice under section 142(1) of the Act was never effected upon the assessee, therefore, keeping in view the factual position of the present case, we are of the view that proper service of notice is vital for imposition of penalty under section 271(1)(b) of the Act. Moreover, the Affidavit filed by the assessee and the report of the IT Department which has been placed on record and relied upon by the assessee, has not been rebutted or controverted by the D/R. Therefore, considering the un-rebutted documents relied upon by the assessee and also keeping in view the principles laid down by the High Court in case of CIT vs Har Parshad, since there is no proof of delivery and service of notice under section 142(1), therefore, no penalty is attracted under section 271(1)(b) of the Act.
- Whether if assessee has sufficient interest free own funds to lend monies interest free, no addition for notional interest is required to be made – YES : ITAT
[2023-TIOL-1180-ITAT-DEL FABINDIA OVERSEAS PVT LTD Vs. JCIT]
It is a settled position of law that if the assessee has sufficient interest free own funds to lend monies interest free, no addition is called for. Since, it is contested that the assessee has own interest free funds, the matter is being referred back to the file of the AO to examine the availability of interest free own funds and compute the disallowance accordingly. In the result, the appeal of the assessee is partly allowed.
- Whether mere non-filing of TDS statement is a technical default and no penalty is warranted – YES: ITAT
[2023-TIOL-1190-ITAT-NAGPUR ITA No. 480/NAG/2016 M/s ATASHA ASHIRWAD BUILDERS Vs. ACIT (TDS)]
That there was no delay in deposit of TDS amounts in the concerned account of Central Government and it is only delay in furnishing of TDS statement which is technical in nature, no penalty is warranted in terms of the finding of this Tribunal in the case of Maharashtra Jeevan Pradhikaran Works Division.
- Whether fresh assessment order passed consequent to revisional order passed u/s 263 of the I-T Act, would sustain where the revisional order itself has been set aside – NO: HC
[2023-TIOL-1193-HC-AHM-IT _ R/Tax Appeal No. 577 of 2023 PRINCIPAL COMMISSIONER OF INCOME TAX-1 Vs. M/s ELECON EPC PROJECTS LTD]
The Assessee claimed that the ITAT subsequently set aside the revisional order passed by the CIT and in which case, the assessment order passed by the AO based on the revisional order, would stand invalidated. That order of assessment was carried in appeal before the CIT(A) by the assessee. It was the case of the assessee before the appellate authority that in light of the fact that the assessee’s appeal before the ITAT, Ahmedabad wherein Revision proceedings under Section 263 of the Act was under challenge and that the Tribunal vide order dated 13.07.2022 had set aside the order under Section 263 of the Act of 27.03.2018, the consequential order of assessment under Section 143 r.w. Section 263 of the Act would no longer stand.
- [2023] 154 taxmann.com 347 (Chandigarh – Trib.) Parmod Singla vs. ACIT*
Mere fact that survey/search proceedings have been initiated at business premises of assessee doesn’t mandate Assessing officer to automatically invoke deeming provisions of sections 69 and 69A; said provisions can be invoked only where explanation offered by assessee is not found satisfactory; where from explanation offered by assessee it clearly emerged that source of income offered during survey was from his business operations, such income could not be taxed under sections 69 and 69A.
- [2023] 154 taxmann.com 600 (Calcutta) PCIT vs. Tata Medical Centre Trust
Order passed under section 263 did not incorporate DIN and was thus in violation of Circular No. 19 of 2019, dated 14-8-2019 which stated that any communication which was not in conformity with said Circular shall be treated as invalid and shall be deemed to have never been issued – On appeal to High Court revenue submitted that intimation letter should be treated as part and parcel of substantive order, however, in intimation letter there was nothing mentioned as to why in substantive order DIN was not mentioned as mandated in Circular – In Miscellaneous Application proceedings, revenue could not answer a specific query as to how a DIN intimation letter along with manual order fulfils categorical requirement mandated by CBDT Circular and therefore, Tribunal came to conclusion that order passed under section 263 did not satisfy requirement mandated by CBDT Circular – Whether therefore, appeal of revenue was to be dismissed as devoid of substantial question of law – Held, yes [In favour of assessee]
- [2023] 154 taxmann.com 318 (SC) PCIT-10 vs. Krishak Bharti Cooperative Ltd.
Where assessee, cooperative society registered in India, received dividend income from its JV which was registered as company under Omani laws, since assessee established a branch office which was treated as PE to invest in JV, assessee was aiding to promote economic development within Oman and achieve object of Article 8 (bis) and thus, Article 8(bis) exempts dividend tax received by assessee from its PE in Oman and by virtue of Article 25, assessee would be entitled to same tax treatment in India.
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