ITAT Ahmedabad Judgments — January 2025

The Tribunal condoned the delay in filing the appeal, set aside the appellate order, and remanded the case back to the Jurisdictional AO for a fresh assessment. The assessee was given one more opportunity of hearing with a cost of Rs. 10,000/-.

The Tribunal held that the assessee had consciously chosen not to pursue the appellate route initially and there was no sufficient cause shown for the delay. The assessee failed to demonstrate a meritorious case on merits. Therefore, the delay was not condoned, and the appeal was dismissed as not maintainable.

The Tribunal held that the CIT(A) passed a mechanical order without independent application of mind and failed to consider the ITAT's earlier order deleting the addition. Since the basis for the penalty was removed, the penalty cannot survive.

The Tribunal held that only the profit element embedded in unaccounted receipts should be taxed, not the entire amount. They also noted that unaccounted expenses should be set off against unaccounted receipts. The profit margins estimated by the CIT(A) for both hospitality and real estate businesses were modified by the Tribunal.

The Tribunal held that the reopening of assessment under Section 147 was justified based on the evidence gathered by DGCEI. Regarding the addition, it was held that only the profit component embedded in the unaccounted sales is taxable, and the CIT(A)'s estimation of 6% profit (Rs.45,08,126/-) was considered reasonable.

The Tribunal condoned the delay in filing the appeals, noting the trust's charitable activities and that the rejection was on technical grounds, not merits. Considering the subsequent amendment to Section 12A(1)(ac)(iii) which now permits provisional approval under Section 10(23C)(vi), the Tribunal set aside both the Section 12A registration and Section 80G(5) approval matters to the CIT(E) for re-adjudication, allowing the assessee another opportunity to rectify the defect.

The Tribunal noted that the Revenue's appeal was dismissed due to low tax effect as per CBDT circular. For the assessee's appeal, additional documents were filed before the Tribunal, leading the Tribunal to set aside the matter to the Assessing Officer for verification.

The Tribunal held that the AO erred in treating all cash deposits as anonymous donations without examining whether they were accumulations of small cash donations with identifiable donors. The Tribunal noted that donations up to Rs. 2,000 made in cash, with donor's name and mobile number, cannot be considered anonymous.

The Tribunal held that the Assessing Officer failed to specify the exact limb of Section 270A under which the penalty was levied. Furthermore, the facts of the case did not fall under the specific clauses of Section 270A(9) relating to misreporting. Therefore, the penalty was not sustainable.

The Tribunal held that the PCIT was justified in invoking Section 263 as the AO failed to conduct a proper inquiry into the undisclosed income. The assessment order was set aside to the extent of the undisclosed income, with a direction for a fresh inquiry.

The Revenue requested to withdraw the appeal in accordance with CBDT guidelines due to the low tax effect. The Tribunal allowed the appeal to be withdrawn.

The Tribunal held that the assessee should be given another opportunity of hearing by the CIT(E) to explain the discrepancy and then decide the case on merits for registration.

Despite multiple opportunities and adjournments, the assessee failed to appear for the final hearing and her representative withdrew. The tribunal dismissed the appeal for non-prosecution, finding no reason to interfere with the well-reasoned order of the CIT(A), which had already provided substantial relief.

The Tribunal noted that the relevant provision of Section 12A(1)(ac)(iii) has been amended to allow registration based on provisional approval under Section 10(23C)(vi). The Tribunal set aside the matter to the CIT(E) to grant the assessee another opportunity to rectify the defect and consider the application in light of the amended provisions.

The Tribunal noted procedural lapses in the assessment and appellate proceedings, including the denial of personal hearing and the transfer of jurisdiction without proper notice. However, it also acknowledged the assessee's failure to provide adequate explanations for the deposits. The matter was remanded to the AO for fresh adjudication.

The tribunal was informed that the assessee had opted for the Direct Tax Vivad Se Viswas Scheme, and requested to withdraw the appeal. The Departmental Representative had no objection.

The Tribunal held that the AO and CIT(A) erred in treating the loan as bogus based solely on an affidavit from a third party, without allowing cross-examination. The loan transaction was found to be through banking channels, with interest paid and TDS deducted, and the loan was repaid, thus establishing its genuineness.

The Tribunal held that the DVO's FMV estimation was not reliable as it compared flat sale instances with bare land value and ignored comparable land sale instances. The addition made by the AO was based on an estimation without evidence of actual expenditure.

The assessee requested to withdraw the appeal as they had opted for the Vivad Se Viswas Scheme, which was accepted by the Ld. PCIT. The Departmental Representative had no objection to this request.

The assessee's counsel filed an application to withdraw the appeal because the assessee opted to settle the dispute under the Vivad se Vishwas (VSV) scheme, 2024. The assessee paid the settlement amount as per the scheme.

The assessee's counsel requested to withdraw the appeal as the trust's objects were revised to not be restricted to a specific religious group. The appeal was subsequently dismissed as withdrawn.

The assessee requested to withdraw the two appeals, which was allowed as the Revenue did not object. Consequently, the appeals were dismissed as withdrawn.

The Tribunal allowed the request of the assessee for withdrawal of the two appeals, as the Departmental Representative did not object.

The Tribunal held that Section 26 of the Income Tax Act governs the taxation of rental income from co-owned property when shares are specific and ascertainable. However, to ensure correct tax application, the matter was restored to the AO to verify the tax rates of individual co-owners.

The Tribunal held that the co-ownership agreement clearly establishes specific and determinate shares, making Section 26 applicable. However, to ascertain the correct rate of taxation and ensure compliance, the matter was restored to the AO to verify the tax rates of individual co-owners and apply Section 167B(2) or Section 167B accordingly.

The Tribunal held that interest earned by a co-operative society from investments made with another co-operative society is eligible for deduction under Section 80P(2)(d) of the Income Tax Act. Relying on various High Court and Tribunal judgments, it was concluded that Section 80P(4) does not exclude co-operative banks from the definition of co-operative societies for the purpose of this deduction.

The Tribunal held that considering the assessee subsequently filed the return and paid all due taxes after the Section 148 notice, and had promptly rectified the short deduction, no penalty under Section 270A for misreporting of income is leviable in this case. The appeal of the assessee was allowed.

The Tribunal allowed the appeal on the first ground regarding the addition for property purchase, accepting the sources of funds from family members. The enhancement made by the CIT(A) on account of unexplained expenditure was also deleted.

The Tribunal noted that the Assessing Officer and CIT(A) did not address the assessee's alternate claim under Section 36(1)(iii). The matter was restored to the Assessing Officer to verify the genuineness of the claim for interest expenditure as business expense and to ascertain the nexus for the expenses claimed under Section 57.

The Tribunal found that an ex-parte order was passed without considering the merits of the case. Both parties agreed that the matter should be remanded to the CIT(A) for a fresh hearing.

The Tribunal held that the PCIT erred in setting aside the assessment order. The Tribunal found that the assessee had provided explanations and documentary evidence regarding the cash deposit, and the discrepancy regarding dates was clarified. The Tribunal concluded there was no lack of enquiry by the Assessing Officer and no prejudice caused to the revenue.

The Tribunal noted the assessee had an opening balance of Rs. 5,16,400. Considering this, along with tuition income and marriage gifts, the Tribunal held that no addition under Section 69A was called for.

The Tribunal held that the assessee had discharged its onus by providing evidence like PAN, ledger accounts, loan confirmations, IT returns, and bank statements for the loans. The AO's disallowance was restricted to Rs.86 Lakhs, which was also deleted by the CIT(A).

The Tribunal set aside the appellate order and directed the Assessing Officer to pass a fresh order on merits, granting one more opportunity of hearing to the assessee. The appeal was allowed for statistical purposes.

The Tribunal held that the penalty proceedings should also be set aside to the file of the AO for de novo assessment. It was observed that the assessment order was not cancelled but set aside, keeping the proceedings in abeyance.

The Tribunal noted that the assessee's delay in filing the appeal was due to illiteracy and unawareness of procedures, and the assessment was ex-parte without adjudicating on merits. The Tribunal held that procedural technicalities should not hinder substantial justice and restored the matter to the AO for fresh adjudication.

The Tribunal held that the CIT(A) correctly accepted the assessee's explanation regarding unusual cash sales during the demonetization period due to a rush of customers. The tribunal also noted that the AO's approach was selective and that the applicability of Section 115BBE was questionable for transactions prior to its effective date.

The Tribunal held that the CIT(A) erred in deleting additions without providing a proper opportunity to the AO to respond to the remand report. The Tribunal set aside the matter for a fresh adjudication.

The Tribunal held that the proviso to section 11(2) of the Income Tax Act, 1961, applies because the approval for registration was granted before the assessment proceedings concluded. Voluntary contributions are capital receipts and not chargeable to tax.