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686 tribunal orders from the Agra bench in 2026.
Showing 40 of 686 orders. Use the months below for the rest.
The Tribunal held that the PCIT's action in setting aside the assessment order was sustainable only on the issue of valuation of inventory under Section 145A(ii). The Tribunal found that the assessee's submission and the auditor's note indicated that taxes, duties, and cess were accounted for separately and not included in the valuation of purchase and sale of goods or inventory. This was a direct violation of Section 145A(ii) of the Act, making the assessment order erroneous and prejudicial to the interest of revenue on this specific issue. Consequently, the Tribunal upheld the PCIT's order in setting aside the AO's order concerning this point. However, for all other issues raised by the PCIT (cash deposits, liquidity, Omaxe group transactions, increased gross receipts, and declining NP/Turnover ratio), the Tribunal found that the PCIT's findings did not justify that the AO's order was either erroneous or prejudicial to the interest of revenue. Therefore, the PCIT's action in setting aside the assessment order on these other issues was not sustainable and was quashed. The appeal of the assessee was partly allowed.
The Tribunal condoned the delay of 358 days in filing the appeal, finding sufficient cause for the assessee's inability to file within the prescribed period. The Tribunal noted that the assessee's claim of non-receipt of notices was supported by an uncontroverted affidavit. However, the Tribunal observed that the assessee had not cooperated with the CIT(A) at the assessment stage and had failed to substantiate his grounds of appeal before the first appellate authority, as noted by the CIT(A). The Tribunal acknowledged its previous decision in ITA No. 362/Agr/2026 for AY 2018-19, where similar additions were deleted. Nevertheless, it held that the benefit of that decision could not be extended to the present case unless the assessee substantiated his grounds before the CIT(A). Therefore, in the interest of justice and to provide another opportunity, the Tribunal set aside the order of the CIT(A) and restored the matter to his file for fresh adjudication. The first appellate authority was directed to ensure substantial compliance with the principles of natural justice, and the assessee was directed to be diligent in attending hearing notices.
The ITAT held that the learned CIT(A) erred in dismissing the assessee's appeal in limine without condoning the delay. The Tribunal took judicial notice of the period of the global COVID-19 pandemic, referencing the Supreme Court's order in Misc. Application No. 21/2022, which excluded the period from March 15, 2020, to February 28, 2022, for the purpose of limitation in judicial and quasi-judicial proceedings. The ITAT found the reasons provided by the assessee for the delay to be sufficient, especially considering the pandemic period. The Tribunal emphasized the principle that substantial justice should not be denied due to technicalities and that parties should not be ordinarily denied the opportunity to participate in justice dispensation. Consequently, the ITAT condoned the delay in filing the first appeal before the CIT(A). The impugned order of the CIT(A) was set aside, and the matter was restored to the file of the CIT(A) for a fresh decision on merits, ensuring compliance with the principles of natural justice.
The ITAT held that the learned CIT(A) erred in dismissing the assessee's appeal as time-barred and subsequently deciding it on merits. The Tribunal condoned the delay of 1428 days in filing the first appeal before the CIT(A), considering the assessee's status as a retired senior citizen with limited knowledge and the bonafide cause for the delay. The ITAT emphasized that substantial justice should not be denied on technicalities and that the object of procedural rules is to advance justice. The Tribunal also noted that deciding an appeal on merits after rejecting the prayer for condonation of delay is contrary to established legal principles. The ITAT cited the Supreme Court's observation in Union of India & Anr. v. Jahangir Byramji Jeejeebhoy (D) and the Allahabad High Court's order in Dinanath Singh & Anr. V. State of U.P. & Ors., stating that an appellate authority lacks jurisdiction to entertain a time-barred appeal without condoning the delay. Consequently, the ITAT set aside the impugned order of the CIT(A) and restored the matter to the CIT(A)'s file for a fresh decision on merits after considering the authoritative precedents. The ITAT directed the assessee to be diligent and cooperative and the CIT(A) to ensure observance of principles of natural justice.
The Tribunal held that the learned CIT(A) erred in dismissing the assessee's first appeals solely on the technicality of delay without affording a proper opportunity of hearing. Citing the Supreme Court's decision in Sambhaji and Ors V Gangabai and Ors, the ITAT emphasized that procedural law is subservient to justice and should not be a barrier to meeting extraordinary situations for the ends of justice. The Tribunal found the grounds raised by the assessee before the CIT(A) for condoning the delay to be sufficient. Consequently, the ITAT condoned the delay, set aside the impugned orders of the CIT(A) dated 27.07.2026, and restored the matters to the file of the CIT(A) for passing a fresh order on merits after considering the precedents and ensuring compliance with the principles of natural justice. The appeals were allowed for statistical purposes.
The Tribunal held that the denial of exemption under Section 10(23C)(iiiad) solely on the ground of non-filing of a return under Section 139(4C) was incorrect for AY 2020-21. The Tribunal noted that the requirement of filing a return under Section 139(4C) as a condition precedent for exemption was introduced by the Finance Act, 2022, effective from April 1, 2023 (i.e., AY 2023-24 onwards) through the 20th proviso to Section 10(23C). This amendment was not applicable to the AY 2020-21. The Tribunal further observed that the statute itself recognizes belated returns filed in response to a notice under Section 142(1), as evidenced by Section 234A, and such returns should not be treated as non-est or invalid. The assessee had filed a return in response to a notice under Section 148, and claimed exemption therein. The Tribunal found that the assessee satisfied the substantive conditions prescribed under Section 10(23C)(iiiad) for the year under consideration. Therefore, the denial of exemption by the revenue authorities on the premise of non-filing of a return under Section 139(4C) was not justified. The Tribunal set aside the order of the CIT(A) and directed the Assessing Officer to delete the addition made.
The Tribunal held that the penalty levied under Section 272A(1)(d) was not sustainable. The Tribunal noted that while the assessee failed to comply with the notices by the stipulated dates, the Assessing Officer (AO) had afforded an opportunity by issuing a second notice, indicating a willingness to receive the information. Crucially, the assessee did furnish the required information on October 21, 2024, which was taken into account by the AO while framing the assessment. The Tribunal reasoned that since the assessee ultimately complied and the information was used in the assessment, initiating penalty proceedings for a technical breach, especially after an opportunity was given, was not appropriate. The Tribunal respectfully followed judicial precedents, including the decision in Bundelkhand University (supra), which held that for mere technical or venial breaches, penalty should not be levied when full compliance is made before the assessment is finalized. The Tribunal directed the Assessing Officer to delete the impugned penalty. The issue was decided in favor of the assessee.
The Tribunal held that the Diwali expenses of Rs. 24,340/- were incurred for celebrating Diwali at the business premises with staff and customers, creating goodwill, and were therefore considered for business purposes. The addition of Rs. 24,340/- was deleted. Regarding general and office expenses, the Tribunal noted that the assessee did not contest the AO's finding that Rs. 76,118/- were personal in nature, so the disallowance to that extent was confirmed. However, in the absence of specific findings by the AO or NFAC that the balance expenses were personal or not for business purposes, the disallowance of the remaining amount was not sustained and was deleted. Therefore, the disallowance of Rs. 76,118/- was sustained, and the balance disallowance of Rs. 5,08,410/- was deleted. The Tribunal found that the disallowance of sales promotion expenses was not discussed separately in the operative part of the judgment, but the overall appeal was partly allowed. The operative direction was to delete the disallowance of Rs. 5,08,410/- and sustain the disallowance of Rs. 76,118/-.
The Tribunal held that the learned CIT(A) erred in dismissing the assessee's first appeals solely on the technicality of delay without affording a proper opportunity of hearing. Citing the Supreme Court's decision in Sambhaji and Ors V Gangabai and Ors, the ITAT emphasized that procedural law is subservient to justice and should not be a barrier to meeting extraordinary situations for the ends of justice. The Tribunal found the grounds raised by the assessee before the CIT(A) for condoning the delay to be sufficient. Consequently, the ITAT condoned the delay, set aside the impugned orders of the CIT(A) dated 27.07.2026, and restored the matters to the file of the CIT(A) for passing a fresh order on merits after considering the precedents and ensuring compliance with the principles of natural justice. The appeals were allowed for statistical purposes.
The Tribunal held that the learned CIT(A) erred in dismissing the assessee's first appeals solely on the technicality of delay without affording a proper opportunity of hearing. Citing the Supreme Court's decision in Sambhaji and Ors V Gangabai and Ors, the ITAT emphasized that procedural law is subservient to justice and should not be a barrier to meeting extraordinary situations for the ends of justice. The Tribunal found the grounds raised by the assessee before the CIT(A) for condoning the delay to be sufficient. Consequently, the ITAT condoned the delay, set aside the impugned orders of the CIT(A) dated 27.07.2026, and restored the matters to the file of the CIT(A) for passing a fresh order on merits after considering the precedents and ensuring compliance with the principles of natural justice. The appeals were allowed for statistical purposes.
The Tribunal held that the notice under Section 148 of the Income Tax Act, 1961, dated 05.04.2023, for Assessment Year 2019-20, was issued beyond the permissible time limit. It was undisputed that the time limit of three years from the end of the assessment year expired on 31.03.2023. The Tribunal noted that Section 149(1)(b) read with Section 149(1)(a) pertains to escaped income less than Rs. 50,00,000/-. Since the notice was issued on 05.04.2023, it was time-barred and bad in law. Consequently, all subsequent proceedings were vitiated. The assessment order dated 26.11.2024 was set aside and quashed. The Tribunal stated that the other legal issues raised were academic and left them undecided. The appeal was allowed.
The Tribunal held that the learned CIT(A) erred in dismissing the assessee's first appeals solely on the technicality of delay without affording a proper opportunity of hearing. Citing the Supreme Court's decision in Sambhaji and Ors V Gangabai and Ors, the ITAT emphasized that procedural law is subservient to justice and should not be a barrier to meeting extraordinary situations for the ends of justice. The Tribunal found the grounds raised by the assessee before the CIT(A) for condoning the delay to be sufficient. Consequently, the ITAT condoned the delay, set aside the impugned orders of the CIT(A) dated 27.07.2026, and restored the matters to the file of the CIT(A) for passing a fresh order on merits after considering the precedents and ensuring compliance with the principles of natural justice. The appeals were allowed for statistical purposes.
The ITAT allowed the assessee's appeal for statistical purposes and set aside the impugned order of the CIT(A). The Tribunal condoned the delay in filing the first appeal before the CIT(A). The reasoning was that the delay overlapped with the COVID-19 pandemic period, and the Supreme Court had directed the exclusion of 15.03.2020 to 28.02.2022 for limitation. The Tribunal emphasized that substantial justice should not be denied on technicalities and that the assessee's cause for delay appeared sufficient. Furthermore, the ITAT noted that the CIT(A) had erred by deciding the appeal on merits after rejecting the prayer for condonation of delay. The law dictates that an appeal does not legally exist until the delay is condoned, and an appellate authority lacks jurisdiction to decide a time-barred appeal on merits without condoning the delay. The matter was restored to the file of the CIT(A) for a fresh order on merits after considering the precedents, with a direction for expeditious disposal and observance of natural justice. The issue of exemption under Section 10(10AA) was not decided on merits by the ITAT.
The Tribunal admitted the additional evidence regarding sundry creditors, finding sufficient cause for not filing it earlier due to a change in counsel. The Tribunal noted that the balance sheet for FY 2006-07, relevant to AY 2007-08, showing construction and development costs for the asset sold, had not been dealt with by the CIT(A). Furthermore, the fact that an addition of Rs. 25,84,000/- on account of cash deposit was also made in the assessment order of the assessee's husband, Shri Deepak Chandak, had not been considered by the CIT(A). Given these points requiring fresh examination and factual verification, the Tribunal set aside the order of the CIT(A) and restored the matter to the file of the Assessing Officer (AO) for a fresh assessment. The admitted additional evidence was directed to be considered by the AO during the fresh assessment proceedings. All grounds of appeal were allowed for statistical purposes.
The Tribunal held that the learned CIT(A) should have provided at least one more opportunity to the assessee to present the reasons for the delay in filing the appeal before dismissing it. The Tribunal emphasized the importance of adhering to the principles of natural justice. Consequently, the ITAT restored the matter to the file of the CIT(A) with a direction for the assessee to file a fresh condonation application. The CIT(A) is directed to decide this application in accordance with the law and thereafter decide the appeal on merits. The Tribunal also stressed that the first appellate authority must ensure substantial compliance with the principles of natural justice. The order of the CIT(A) was set aside. The appeal was allowed for statistical purposes.
The Tribunal noted that the assessee's claim for exemption under Section 10(23C)(iiiad) was rejected primarily because it could not initially prove that the cash deposits were indeed students' fees. The Tribunal observed that the annual gross receipts were below Rs. 1 crore. In the interest of justice, and considering the assessee's request to produce evidence, the Tribunal decided to afford the assessee an opportunity to prove the nature of the cash deposits. The matter was remitted back to the Assessing Officer, who was directed to consider the fresh evidence to establish that the deposits were students' fees received during the year. The Assessing Officer was also directed to ensure compliance with the principles of natural justice. The appeal was allowed for statistical purposes.
The Tribunal noted that the CIT(A) had issued several notices for hearing (dated 03.06.2026, 17.06.2026, and 27.07.2026), but no one appeared on behalf of the assessee, and no written submissions were filed, leading to an ex-parte order. The Tribunal found that while the assessee's non-appearance was not appreciated, the CIT(A)'s order lacked any finding on the assessee's contention that it acted as an intermediary and thus Section 194Q was not applicable. To ensure substantial justice and provide another opportunity, the Tribunal set aside the CIT(A)'s order and restored the matter for fresh adjudication. The assessee was directed to be diligent in attending future hearings. All grounds of appeal were allowed for statistical purposes.
The Tribunal condoned the delay of 663 days in filing the appeal, finding the reasons provided by the assessee, relating to his wife's health and counsel's non-compliance, to be sufficient. Regarding the substantive issue, the Tribunal noted the assessee's submission that the cash deposits of Rs. 1,59,54,170/- pertained to cash sales in his liquor business. Considering the interest of justice and the assessee's request for an opportunity to explain the facts before the AO, the Tribunal set aside the order of the CIT(A) and restored the matter to the file of the AO for fresh assessment in accordance with law. The ratio decidendi is that in cases of significant delay caused by circumstances beyond the assessee's control and where a substantive issue requires examination, it is just and appropriate to restore the matter to the AO for a fresh assessment, provided the assessee demonstrates a prima facie case and a willingness to cooperate.
The Tribunal noted that the penalty under Section 271AAC(1) was levied due to the non-issuance of Form 4, which would entitle the assessee to a waiver of penalty under the DTVSV Scheme, 2024. The assessee had opted for the scheme and requested Form 4 from the Principal CIT, Agra-1, vide a letter dated 03.04.2026, which was pending. The Tribunal found the assessee's request to set aside the matter to the CIT(A) reasonable, directing the CIT(A) to keep the appeal pending until the issue of Form 4 under the DTVSV Scheme is finally decided by the Principal CIT, Agra-1. All grounds of appeal were allowed for statistical purposes. The Tribunal did not decide the merits of the penalty itself but remanded the matter for procedural completion.
The Tribunal held that the delay of approximately 43 days in filing the first appeal before the CIT(A) for Assessment Year 2020-21 is liable to be condoned. The Tribunal reasoned that the object of prescribing limitation periods is to expedite proceedings and advance the cause of justice, and that substantial justice should not be denied on technicalities. Citing the Supreme Court's decision in Sambhaji and Ors V Gangabai and Ors, the Tribunal emphasized that procedural law is subservient to justice and should not be an obstruction. The cause shown by the assessee, i.e., a clerical mistake by their authorized representative, was considered sufficient. Consequently, the impugned order of the CIT(A) was set aside, the delay was condoned, and the matter was restored to the file of the CIT(A) for a fresh decision on merits, ensuring compliance with the principles of natural justice.
The Tribunal held that the Commissioner of Income Tax (Exemption)'s observation that only institutions or funds established for purely "charitable purposes" are eligible for registration under Section 80G(5) of the Act is not acceptable. The Tribunal referred to Section 80G(5B), which provides a deeming fiction: an institution or fund incurring expenditure of a religious nature not exceeding 5% of its total income in a previous year shall be deemed to be an institution or fund to which the provisions of Section 80G apply, making it eligible for deduction. Therefore, an institution or fund can be eligible for 80G registration if its expenditure on religious activities does not exceed 5% of its total income, as provided in Section 80G(5B). However, the Tribunal noted that the CIT(E) had not provided a working to substantiate its finding that the assessee violated Section 80G(5B) by incurring religious expenditure exceeding 5% of its total income. The assessee, in its grounds, claimed to have fulfilled this condition. Consequently, the Tribunal set aside the impugned order of the CIT(E) and restored the matter to his file for fresh adjudication. The CIT(E) is directed to grant renewal of approval under Section 80G if he finds that the assessee has not incurred religious expenditure exceeding 5% of its total income in the previous year, subject to satisfaction of other conditions and in accordance with law. Grounds 1 to 8 of the appeal were allowed for statistical purposes.
The Tribunal held that the learned CIT(A) erred in dismissing the assessee's appeals solely on the ground of delay without condoning it. The Tribunal emphasized the well-established legal principle that substantial justice should not be denied on technicalities and that procedural law is subservient to justice. Citing the Supreme Court's judgment in Sambhaji and Ors V Gangabai and Ors, the Tribunal stated that the object of procedural rules is to advance justice, and parties should not ordinarily be denied an opportunity to be heard. The Tribunal considered the grounds raised by the assessee for condonation as sufficient cause. Consequently, the delay in filing the first appeals before the CIT(A) was condoned. The impugned orders of the CIT(A) were set aside, and the matters were restored to the file of the CIT(A) for passing fresh orders on merits, ensuring compliance with the principles of natural justice.
The Tribunal held that the learned CIT(A) erred in dismissing the assessee's appeals solely on the ground of delay without condoning it. The Tribunal emphasized the well-established legal principle that substantial justice should not be denied on technicalities and that procedural law is subservient to justice. Citing the Supreme Court's judgment in Sambhaji and Ors V Gangabai and Ors, the Tribunal stated that the object of procedural rules is to advance justice, and parties should not ordinarily be denied an opportunity to be heard. The Tribunal considered the grounds raised by the assessee for condonation as sufficient cause. Consequently, the delay in filing the first appeals before the CIT(A) was condoned. The impugned orders of the CIT(A) were set aside, and the matters were restored to the file of the CIT(A) for passing fresh orders on merits, ensuring compliance with the principles of natural justice.
The Tribunal held that the CIT(E) rejected the assessee's application by not condoning a delay of 46 days in filing the application, without adjudicating the application on its merits. The Tribunal took note of CBDT Circular No. 1/2026 dated 23.03.2026, which clarifies that the CIT(E) has the power to condone delays under the proviso to Section 12A(1)(ac) and that eligible trusts should not be denied registration solely on account of delay. The Tribunal considered the assessee's explanation for the delay to be reasonable. Consequently, the Tribunal deemed it just and proper to condone the delay and remit the matter back to the file of the CIT(E) to decide the application afresh on its merits after affording sufficient opportunity of hearing to the assessee. The appeal was allowed for statistical purposes.
The Tribunal held that the rejection of the assessee's application by the CIT(E) was based solely on a technical ground, specifically filing under the wrong sub-clause of section 12A(1)(ac) of the Act, without any adverse remarks regarding the nature of the assessee's activities or objectives. The Tribunal noted that no show-cause notice was issued by the CIT(E) before rejecting the application. Relying on the coordinate bench decision in Shree Swaminarayan Gadi Trust vs CIT (2024) 162 taxman.com 772, the Tribunal found that an inadvertent mistake in filing the application under the wrong sub-clause is not fatal and could be considered in the appropriate sub-clause. The Tribunal directed the registry official of the CIT(E) to either correct the mistake on the ITBA portal or allow the assessee to rectify or amend the relevant clause/sub-clause of section 12A(1). Consequently, the impugned order of the CIT(E) was set aside, and the CIT(E) was directed to treat the application as filed under section 12A(1)(ac)(iii) instead of section 12A(1)(ac)(vi)(B) and to consider the case on its merits after granting an opportunity of hearing to the assessee and allowing the assessee to furnish complete details. The appeal was allowed for statistical purposes.
The tribunal considered the withdrawal applications filed by the assessee. The department representative raised no objection to the withdrawal.
The Tribunal held that the learned CIT(A) erred in dismissing the assessee's appeals solely on the ground of delay without condoning it. The Tribunal emphasized the well-established legal principle that substantial justice should not be denied on technicalities and that procedural law is subservient to justice. Citing the Supreme Court's judgment in Sambhaji and Ors V Gangabai and Ors, the Tribunal stated that the object of procedural rules is to advance justice, and parties should not ordinarily be denied an opportunity to be heard. The Tribunal considered the grounds raised by the assessee for condonation as sufficient cause. Consequently, the delay in filing the first appeals before the CIT(A) was condoned. The impugned orders of the CIT(A) were set aside, and the matters were restored to the file of the CIT(A) for passing fresh orders on merits, ensuring compliance with the principles of natural justice.
The Tribunal held that while the assessee's non-cooperative conduct in not filing details before the CIT(A) despite multiple opportunities could not be appreciated, the order of the CIT(A) was not a speaking order. The CIT(A) had dismissed the appeal on merits after reproducing the assessment order's reasoning, which added Rs. 45,00,000/- based on a seized document (LPS-01) indicating cash payment received by the assessee's husband on behalf of the assessee for property sale. The Tribunal, in the interest of justice and to provide one more opportunity, restored the matter to the file of the CIT(A) for fresh adjudication on merits. The assessee was directed to be diligent and cooperative. The CIT(A) was instructed to ensure observance of principles of natural justice. All grounds were allowed for statistical purposes.
The Tribunal held that the learned CIT(A) erred in dismissing the assessee's appeals solely on the ground of delay without condoning it. The Tribunal emphasized the well-established legal principle that substantial justice should not be denied on technicalities and that procedural law is subservient to justice. Citing the Supreme Court's judgment in Sambhaji and Ors V Gangabai and Ors, the Tribunal stated that the object of procedural rules is to advance justice, and parties should not ordinarily be denied an opportunity to be heard. The Tribunal considered the grounds raised by the assessee for condonation as sufficient cause. Consequently, the delay in filing the first appeals before the CIT(A) was condoned. The impugned orders of the CIT(A) were set aside, and the matters were restored to the file of the CIT(A) for passing fresh orders on merits, ensuring compliance with the principles of natural justice.
The Tribunal noted that the assessee's appeal before the CIT(A) was dismissed. The grounds raised by the assessee in the present appeal pertain to the confirmation of the assessment order by the CIT(A) without considering the sub-judice nature of the property's title, the admission of additional evidence, and a subsequent compromise decree from the National Lok Adalat. The judgment does not contain the Tribunal's findings on these grounds or the reasoning behind any decision. The operative directions are also not recorded in the provided text. The specific amount in dispute is Rs. 18,75,000 as unexplained investment and Rs. 39,97,000 as income from other sources.
The Tribunal observed that Ground No. 1 of the appeal raised a valid point regarding the learned CIT(A) passing a non-speaking order in violation of Section 250(6) of the Act. The Tribunal noted that the CIT(A)'s order, as reproduced, merely stated that the assessee's submissions were examined and found not tenable, and the AO's findings were not infirm, without independently dealing with the detailed written submissions and rebuttal of evidence. Consequently, the Tribunal set aside the order of the learned CIT(A) and restored the matter back to his file. The CIT(A) is directed to pass a speaking order afresh, in accordance with law, after providing a reasonable opportunity of being heard to the assessee. All grounds filed by the assessee were allowed for statistical purposes. The Tribunal did not decide on the merits of the disallowance under Section 80GGC or other grounds.
The Tribunal held that the learned CIT(A) erred in dismissing the assessee's appeals solely on the ground of delay without condoning it. The Tribunal emphasized the well-established legal principle that substantial justice should not be denied on technicalities and that procedural law is subservient to justice. Citing the Supreme Court's judgment in Sambhaji and Ors V Gangabai and Ors, the Tribunal stated that the object of procedural rules is to advance justice, and parties should not ordinarily be denied an opportunity to be heard. The Tribunal considered the grounds raised by the assessee for condonation as sufficient cause. Consequently, the delay in filing the first appeals before the CIT(A) was condoned. The impugned orders of the CIT(A) were set aside, and the matters were restored to the file of the CIT(A) for passing fresh orders on merits, ensuring compliance with the principles of natural justice.
The Tribunal noted that the assessee had requested a video conference hearing, which could not be attended due to technical failure at the assessee's end. The CIT(A) passed the impugned order without the assessee being able to effectively participate. To ensure substantial compliance with the principles of natural justice, the Tribunal set aside the order of the CIT(A) and restored the matter to his file. The CIT(A) was directed to grant one more opportunity of hearing through video conferencing to the assessee and pass a fresh order in accordance with law. All grounds of appeal filed by the assessee were allowed for statistical purposes. The Tribunal did not decide the merits of the grounds raised.
The Tribunal held that the learned CIT(A) erred in dismissing the assessee's appeals solely on the ground of delay without condoning it. The Tribunal emphasized the well-established legal principle that substantial justice should not be denied on technicalities and that procedural law is subservient to justice. Citing the Supreme Court's judgment in Sambhaji and Ors V Gangabai and Ors, the Tribunal stated that the object of procedural rules is to advance justice, and parties should not ordinarily be denied an opportunity to be heard. The Tribunal considered the grounds raised by the assessee for condonation as sufficient cause. Consequently, the delay in filing the first appeals before the CIT(A) was condoned. The impugned orders of the CIT(A) were set aside, and the matters were restored to the file of the CIT(A) for passing fresh orders on merits, ensuring compliance with the principles of natural justice.
The Tribunal allowed the appeal. The assessee contended that he was engaged in both trading and bangle businesses and had declared income from both in his return. The written submissions, supported by the computation of income, showed an income of Rs. 1,51,200/- under Section 44AD and Rs. 2,06,262/- from Khawaja Traders. The Tribunal found the assessee's explanation reasonable and supported by the computation of income. Consequently, the addition of Rs. 2,29,000/- made by the AO was deleted. Ground No. 1 of the appeal was accordingly allowed. The Tribunal did not expressly leave any issue undecided.
The Tribunal upheld the CIT(A)'s observation that the opening balance of loans/deposits of Rs. 32,57,728 could not be added under Section 68 of the Act during the year under consideration, and only cash credits received during the year were to be considered for addition. The Tribunal agreed with the CIT(A)'s direction to restore the matter to the AO for verification of the opening balance and deletion of the addition to that extent. Regarding the rejection of the assessee's prayer for admitting additional evidence under Rule 46A, the Tribunal noted that the AO issued a Section 142(1) notice on 09.12.2019 with a compliance date of 11.12.2019, shortly before the assessment completion deadline. Considering this short span and to ensure substantial compliance with natural justice principles, the Tribunal admitted the additional evidence furnished during the first appellate proceedings. The matter was restored back to the AO to admit this evidence, verify the identity, genuineness, and creditworthiness of the unsecured creditors, and pass a fresh order after affording an opportunity of hearing to the assessee. The appeal was allowed for statistical purposes.
The Tribunal held that the additional ground of appeal, challenging the jurisdiction of the PCIT under section 263, was admitted as it was a legal ground with all facts available on record. The Tribunal noted the list of dates provided by the assessee regarding the assessment proceedings initiated by the notice u/s 148 dated 30.07.2022. Following the decision of a coordinate bench in Sub Major Sub Bhadauria vs. ITO and drawing support from other High Court judgments, the Tribunal held that if the original assessment order is illegal or nullity in the eyes of law, the PCIT cannot assume jurisdiction under section 263 to revise such a non-est order. The Tribunal found that the notice u/s 148 dated 30.07.2022 was bad in law, making the subsequent assessment order dated 20.05.2023 also bad in law. Therefore, the revision order passed by the PCIT u/s 263 was quashed as it was passed against a non-est order. The additional ground of appeal was allowed, and other grounds were left undecided as academic.
The Tribunal held that the assessee is entitled to the further exemption of Rs. 7,56,590/- under Section 10(10AA)(ii) of the Act, in addition to the Rs. 3,00,000/- already allowed. The reasoning was based on various coordinate bench decisions of the Tribunal (Ahmedabad, Jaipur, Pune) which have held that the limit for leave encashment exemption has been increased from Rs. 3 lakh to Rs. 25 lakh, as per notification No. 31/2023 issued by the Ministry of Finance. The Tribunal found support from the ITAT Ahmedabad decision in Mr. Goverdhan Bhambhani and the ITAT Pune decision in Devendra Kumar Gupta. The ratio decidendi is that the increased exemption limit for leave encashment is applicable and should be granted to the assessee. The Tribunal set aside the findings of the CIT(A) and directed the assessee to place a revised computation of income before the jurisdictional Assessing Officer for claiming the further exemption, after which the Revenue authorities are to compute the tax liability and grant any refund due. No issue was expressly left undecided.
The Tribunal held that there was sufficient cause to condone the delay of 207 days in filing the appeal, acknowledging the procedural and jurisdictional complexities faced by the assessee. The Tribunal relied on Supreme Court pronouncements for a pragmatic and liberal interpretation of 'sufficient cause', emphasizing substantial justice over technical considerations. Regarding the penalty, the Tribunal found that the assessee had a reasonable cause for the failure to deduct tax at source. This was based on the assessee's bonafide belief regarding the non-deductibility of TDS on commission payments and the disruption in working due to frequent changes in key accounting positions, leading to inadvertent oversights. The Tribunal referred to the Supreme Court's decision in CIT, New Delhi vs. Eli Lilly & Co. (India) (P.) Ltd., which held that penalty under Section 271C shall not be imposed if the assessee proves a reasonable cause for the failure, as per Section 273B. Consequently, the Tribunal held that the levy of penalty under Section 271C was not sustainable and deleted the penalty of Rs. 80,753/-. The first ground of appeal was allowed, and other grounds were left undecided as academic.
The Tribunal held that the assessee bank cannot be treated as an assessee in default under section 201(1) for short deduction of tax on LFC payments made to its employees for foreign travel on 23.07.2014. The reasoning is that the Hon'ble Madras High Court had issued an interim order on 25.04.2014, which was operative during the relevant period. The assessee bank was judicially bound by this interim direction and therefore could not have deducted tax at source without acting contrary to the judicial command. The subsequent Supreme Court order for AY 2013-14, regarding substantive taxability, does not retrospectively convert an act performed in obedience to a binding judicial order into a statutory default. The Tribunal respectfully followed the judgment of the Hon'ble Kerala High Court and coordinate bench orders, which had examined the issue and distinguished the Supreme Court judgment based on assessment year and the period of interim protection. Consequently, interest under section 201(1A), being founded upon the default under section 201(1), cannot survive. The demands raised under sections 201(1) and 201(1A) were set aside. The substantive taxability of LFC involving foreign leg travel was not decided, nor was the tax liability of the employees, as these were not the subject matter of the appeal.