ITO, AHMEDABAD vs. UDAYAN MANDAVIA, AHMEDABAD

ITA 154/AHD/2026Status: DisposedITAT Ahmedabad26 March 2026AY 2017-18Bench: SHRI SIDDHARTHA NAUTIYAL (Judicial Member), SHRI NARENDRA PRASAD SINHA (Accountant Member)8 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the issue regarding the applicability of the amended provisions of section 115BBE, which increased the tax rate from 30% to 60%, is debatable and not a mistake apparent from the record. The Tribunal noted that judicial precedents, including decisions from the Madras High Court and ITAT benches, hold that the amendment is prospective and not applicable to Assessment Year 2017-18 for prior transactions.

What were the facts?

The Assessing Officer (AO) made an addition under section 69A and later passed a rectification order under section 154 to recompute the tax at 60% under section 115BBE, instead of the previously applied 30%. The assessee contended that the applicability of the amended 60% rate was debatable and the rectification was beyond the scope of section 154. The assessee also raised a ground of violation of natural justice.

What were the issues?

Whether the rectification order applying the amended tax rate of 60% under section 115BBE was validly passed under section 154, given that the issue is debatable and supported by judicial precedents stating the amendment is prospective for AY 2017-18.

Which sections of the Income-tax Act were involved?

Section 69A,Section 115BBE,Section 154,Section 147,Section 144B

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Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD

Before: SHRI SIDDHARTHA NAUTIYAL & SHRI NARENDRA PRASAD SINHA

For Appellant: Shri Sudhakar Verma, Sr. DR
For Respondent: Shri Palak Pavagadhi, AR
Hearing: 24.03.2026Pronounced: 26.03.2026

PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:

This appeal has been filed by the Department against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short “Ld. CIT(A)”), ADDL/JCIT(A)-10, Mumbai vide order dated 28.11.2025 passed for A.Y. 2017-18. 2. The Department has taken the following grounds of appeal:

“1. Whether the Ld.CIT(A) has erred in law and on facts in quashing order u/s 154 dated 21.10.2024 wherein the tax was re-computed on addition u/s 69A of the Act @ 60% instead of 30%, applying the amended provisions of Sec. 115BBWE of the I.T. Act, 1961 for A.Y. 2017-18 in the case of the assessee?

2.

Whether the ld.CIT(A) has e

The order continues below.

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