AO Not Justified In Disallowing The Claim Of Interest Expense : ITAT
2 years, 3 months ago

AO Not Justified In Disallowing The Claim Of Interest Expense : ITAT

Live Law  

The Kolkata Bench of the Income Tax Appellate Tribunal has held that the AO is not justified in disallowing the claim of interest expense and treating it for capitalization in the project cost.The two-member bench of Rajpal Yadav and Girish Aggarwal has directed the AO to allow the claim of interest expenses of Rs.41,06,890.The appellant/assessee is. The Kolkata Bench of the Income Tax Appellate Tribunal has held that the AO is not justified in disallowing the claim of interest expense and treating it for capitalization in the project cost. The AO also noted that the assessee had earned an interest income of Rs.89,73,695 duly reported in the audited P&L Account from Williamson Services Ltd. against the Inter-corporate Deposit advance to the company. The appellant submitted that AO had wrongly re-characterized the interest income as income from other sources and disallowed the interest expenses towards capitalization of WIP in respect of construction projects at Rajarhat, New Town.

Expenses Income Project Claim Itat Assessee Interest Expense Interest Expenses  respect  noted  expenses  ao  justified  interest  expense  claim  assessee  disallowing  project  income  itat

History of this topic

Mere Difference Of Opinion With AO Is No Basis To Exercise Revisionary Power U/s 263: Chandigarh ITAT Confirms Sec 80P Deduction Granted By AO
6 months, 3 weeks ago

Mere Difference Of Opinion With AO Is No Basis To Exercise Revisionary Power U/s 263: Chandigarh ITAT Confirms Sec 80P Deduction Granted By AO

Live Law  

The Chandigarh ITAT quashed the revision order u/s 263 holding that application of mind is discernible from examination of the record and that “the power under Section 263 of the Act was exercised on the basis of a mere difference in opinion with the AO, rendering such exercise of revisionary power to be invalid”. The Division Bench comprising A.D. Jain …

Only Requirement To Be Fulfilled For Claiming Expenses U/s 57(Iii) Is That They Must Be Incurred Wholly For Earning Income From Other Sources: Ahmedabad ITAT
7 months, 2 weeks ago

Only Requirement To Be Fulfilled For Claiming Expenses U/s 57(Iii) Is That They Must Be Incurred Wholly For Earning Income From Other Sources: Ahmedabad ITAT

Live Law  

The Ahmedabad ITAT held that in the absence of the Assessing Officer pointing out as to how despite the assessee's explanation, there was no nexus between the interest-bearing funds and their utilization for making advances for earning interest income, no disallowance u/s 57 of the Income tax Act was tenable. The ITAT explained that the only requirement to be fulfilled …

Once ITO Accepted Income Earned Which Is Totally Based Upon Depreciation Plus 15% Markup, There Is No Reason To Deny Cost: Delhi ITAT
9 months, 1 week ago

Once ITO Accepted Income Earned Which Is Totally Based Upon Depreciation Plus 15% Markup, There Is No Reason To Deny Cost: Delhi ITAT

Live Law  

Finding that the assessee had arrangement with its AE for billing cost plus 15%, which has been duly billed during the year and entire depreciation cost plus 15% has been billed to the AE, the New Delhi ITAT allowed the depreciation claimed by assessee. The Bench of Shamim Yahya and Challa Nagendra Prasad observed that “When the Revenue is accepting …

Careless Attitude Of AO: Kolkata ITAT Deletes Addition Made Without Examining Nature Of Expenditure
10 months, 2 weeks ago

Careless Attitude Of AO: Kolkata ITAT Deletes Addition Made Without Examining Nature Of Expenditure

Live Law  

On finding that expenses were incurred for the business purposes during the course of business, for which assessee has submitted all basic details which was not cross verified by the AO, the Kolkata ITAT deleted the addition made by AO. The Member of the ITAT comprising Rajpal Yadav and Girish Agrawal observed that “the inquiry at the end of the …

Without Pointing Out Any Specific Defect In Audited Books Of Accounts AO Can't And Should Not Make Any Estimated Addition: ITAT
1 year ago

Without Pointing Out Any Specific Defect In Audited Books Of Accounts AO Can't And Should Not Make Any Estimated Addition: ITAT

Live Law  

The Delhi Bench of Income Tax Appellate Tribunal has held that without pointing out any specific defect in the audited books of accounts, the AO cannot and should not make any estimated addition.The bench of Kul Bharat and N. K. Billaiya has observed that the expenses claimed by the assessee were also test-checked, and while making the addition, the. The …

ITAT Deletes Income Tax Addition Of Rs.2.30 Crores As AO Failed To Mention Investment Outside The Books Of Accounts
1 year, 1 month ago

ITAT Deletes Income Tax Addition Of Rs.2.30 Crores As AO Failed To Mention Investment Outside The Books Of Accounts

Live Law  

The Delhi Bench of Income Tax Appellate Tribunal has deleted the income tax addition of Rs. 2.30 crores as the Assessing Officer did not mention any investment outside the books of accounts.The bench of Astha Chandra and N. K. Billaiya has observed that the assessee has explained the investment duly reflected in its bank statement, and. The bench of Astha …

Employee Stock Option Expenses Revenue In Nature: ITAT Deletes Disallowance Against Cleartrip
1 year, 3 months ago

Employee Stock Option Expenses Revenue In Nature: ITAT Deletes Disallowance Against Cleartrip

Live Law  

The Mumbai Bench of Income Tax Appellate Tribunal has held that employee stock option expenses are revenue in nature.The bench of Sandeep Singh Karhail and Prashant Maharishi has directed the assessing officer to delete the disallowance of employee stock option expenditure of Rs. The Mumbai Bench of Income Tax Appellate Tribunal has held that employee stock option expenses are revenue …

ITAT Imposes Cost Of Rs.10K On Foreign Portfolio Investor For Not Responding To Section 142(1) Notices
1 year, 4 months ago

ITAT Imposes Cost Of Rs.10K On Foreign Portfolio Investor For Not Responding To Section 142(1) Notices

Live Law  

The Mumbai Bench of the Income Tax Appellate Tribunal has imposed a cost of Rs.10,000 on a foreign portfolio investor for not responding to notices under Section 142 of the Income Tax Act.The bench of Vikas Awasthy and Padmavathy has observed that there is negligence on the part of the assessee in not responding to the notices issued by. The …

ITAT Disallows Interest Paid On Loan Taken For Paying Compensation To Family Members Pursuant To Arbitral Award On Family Settlement
1 year, 5 months ago

ITAT Disallows Interest Paid On Loan Taken For Paying Compensation To Family Members Pursuant To Arbitral Award On Family Settlement

Live Law  

The Panaji Bench of the Income Tax Appellate Tribunal has disallowed the interest paid on a loan that was taken for paying compensation to the assessee’s family members pursuant to an arbitral award on family settlement.The bench of R.S. The Panaji Bench of the Income Tax Appellate Tribunal has disallowed the interest paid on a loan that was taken for …

AO Can’t Make Addition On The Basis Of Statement Without Corroborating It With Any Other Material: ITAT
1 year, 7 months ago

AO Can’t Make Addition On The Basis Of Statement Without Corroborating It With Any Other Material: ITAT

Live Law  

The Mumbai Bench of the Income Tax Appellate Tribunal has held that an AO cannot make additions merely on the basis of a statement without corroborating it with any other material.The bench of Pavan Kumar Gadale and B.R. Baskaran has observed that the AO has assessed entire cash receipts as income of the assessee without examining the nature of. The …

ITAT Sustains Disallowance As Cash Payment Exceeds Rs. 20,000 To Single Party In Single Day
1 year, 11 months ago

ITAT Sustains Disallowance As Cash Payment Exceeds Rs. 20,000 To Single Party In Single Day

Live Law  

The Chennai Bench of the Income Tax Appellate Tribunal has sustained the disallowance under section 40A of the Income Tax Act as a cash payment exceeds INR 20,000 to a single party in a single day.The two-member bench headed by Mahavir Singh and G. Manjunatha has observed that Section 40A, which has been amended w.e.f. The Chennai Bench of the …

ITAT Allows Deduction To ICICI Bank On Interest Expense On Perpetual Bonds
2 years, 2 months ago

ITAT Allows Deduction To ICICI Bank On Interest Expense On Perpetual Bonds

Live Law  

The Mumbai Bench of the Income Tax Appellate Tribunal has allowed ICICI Bank the deduction on interest expense on perpetual bonds.The two-member bench of Kavitha Rajagopal and Amarjit Singh has observed that merely that RBI recognises treating the said debt instruments as additional tier/capital would not change the nature of Innovative Perpetual. The Mumbai Bench of the Income Tax Appellate …

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