Tag Archives: IN THE ITAT CHENNAI BENCH

Estimation of business income by applying a reasonable profit rate on turnover precludes separate additions for cash deposits under Section 69A.

By | July 7, 2026
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Estimation of business income by applying a reasonable profit rate on turnover precludes separate additions for cash deposits under Section 69A. Issue Whether the Assessing Officer is legally justified in estimating a hardware trading firm’s business income by applying a 2% net profit rate on its disclosed turnover when the assessee fails to produce its… Read More »

One-time settlement to contractors is fully deductible under Section 37 as revenue business expenditure

By | July 4, 2026
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One-time settlement to contractors is fully deductible under Section 37 as revenue business expenditure Issue Whether a one-time settlement paid to contractors during business restructuring can be restricted to a one-fifth deduction under Section 35DDA parity, and whether Section 14A disallowances and DDT treaty rate claims can be finalized without proper lower authority verification or… Read More »

Assessee Entitled To Depreciation On Amalgamation Goodwill And Debt-Free Companies Are Exempt From Notional Interest Adjustments

By | July 2, 2026
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Assessee Entitled To Depreciation On Amalgamation Goodwill And Debt-Free Companies Are Exempt From Notional Interest Adjustments Issue Whether an assessee is entitled to claim depreciation at 25% under section 32(1)(ii) on goodwill arising out of an amalgamation scheme approved by the High Court, in the absence of any specific statutory embargo. Whether a Transfer Pricing… Read More »

Forex losses from capital transactions are non-operating, and functionally dissimilar companies must be excluded.

By | June 30, 2026
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Forex losses from capital transactions are non-operating, and functionally dissimilar companies must be excluded. Issue Issue I & II (Section 92C): Whether foreign exchange losses arising from External Commercial Borrowings (ECBs) and capital transactions should be treated as non-operating expenses when computing the Profit Level Indicator (PLI), and whether an automotive/renewable energy component manufacturer can… Read More »

Section 80-IB(10) Housing Deduction Cannot Be Restricted By Arbitrary and Erroneous Land Cost Substitution

By | June 27, 2026
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Section 80-IB(10) Housing Deduction Cannot Be Restricted By Arbitrary and Erroneous Land Cost Substitution Section 80-IB(10) Housing Deduction Cannot Be Restricted By Arbitrary and Erroneous Land Cost Substitution Issue Whether the Commissioner (Appeals) was legally justified in rejecting a rectification application under Section 154 when the original order restricted a housing project’s deduction under Section… Read More »

Domestic AMP spend without an agreement is not an international transaction, and business losses must be allowed for set-off.

By | June 25, 2026
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Domestic AMP spend without an agreement is not an international transaction, and business losses must be allowed for set-off. Issue On Transfer Pricing: Whether Advertisement, Marketing, and Promotion (AMP) expenses incurred within India by a subsidiary to promote its own product sales constitute an “international transaction” under Chapter X, in the absence of an explicit… Read More »

Unrealizable insolvency assets must be excluded from Rule 11UA Fair Market Value computations.

By | June 25, 2026
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Unrealizable insolvency assets must be excluded from Rule 11UA Fair Market Value computations. Issue Whether the Assessing Officer (AO) is legally justified in mechanically invoking Section 50CA and Rule 11UA to calculate the Fair Market Value (FMV) of unquoted shares based purely on book values, without excluding unrealizable insolvency assets or considering the price discovered… Read More »

DSIR-certified R&D qualifies for weighted deduction, and uncertified capital expenditure is allowed as normal deduction.

By | June 24, 2026
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DSIR-certified R&D qualifies for weighted deduction, and uncertified capital expenditure is allowed as normal deduction. Issue Whether the Assessing Officer is required to grant the full 200% weighted deduction under Section 35(2AB) on the capital R&D expenditure certified by the DSIR in Form 3CL, rather than limiting it to 100%. Whether scientific research capital expenditure… Read More »

Consequential verification by AO infirms PCIT’s revisionary order, but unverified CSR and TDS interest claims stand remanded.

By | June 22, 2026
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Consequential verification by AO infirms PCIT’s revisionary order, but unverified CSR and TDS interest claims stand remanded. Consequential verification by AO infirms PCIT’s revisionary order, but unverified CSR and TDS interest claims stand remanded. Issue Whether the Principal Commissioner of Income-tax (PCIT) was legally justified in invoking revisionary jurisdiction under section 263 on the grounds… Read More »

Corporate guarantee fees at 1% upheld; bad debts actual write-off and lease rentals allowed as revenue expense.

By | June 22, 2026
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Corporate guarantee fees at 1% upheld; bad debts actual write-off and lease rentals allowed as revenue expense. Issue Whether the TPO was justified in benchmarking a free corporate guarantee given to an overseas AE at an ALP of 1%, and whether the AO erred in disallowing an actual bad debt write-off and the principal component… Read More »