ITAT Ahmedabad Judgments — April 2025

The Tribunal noted that the matter required examination at the primary level. Therefore, the case was remanded to the Assessing Officer to pass a de novo order after a thorough examination of the bank account.

The Tribunal held that a significant portion of the cash deposit could be attributed to agricultural income and family savings, considering the family's agricultural background and past accepted income. Therefore, a substantial part of the addition was directed to be deleted.

The Tribunal held that the CIT(A)'s reasoning for rejecting the assessee's plea to set off commission income against surrendered cash was not acceptable. The Department had accepted the cash found during the search as the assessee's undisclosed income. Therefore, the Department could not later argue that the cash pertained to parties from whom it was received. This was considered blowing hot and cold. For AY 2018-19, the commission income of Rs. 12,97,897 related to the period April 1, 2017, to July 11, 2017, which overlapped with the period for which Rs. 71,29,230 was surrendered and accepted by the Department. The Tribunal found that both the surrendered income and the commission income noted in loose papers for this period were likely duplicate. Therefore, the addition of Rs. 12,97,897 for AY 2018-19 was not sustainable, and deletion was directed. However, for AY 2017-18, the commission income of Rs. 8,81,634 was not eligible for set-off against the surrendered income because the surrender was made for AY 2018-19 and pertained to that year, not AY 2017-18. Thus, the addition of Rs. 8,81,634 for AY 2017-18 was confirmed.

The Tribunal held that the principles of natural justice were violated as the assessee was not given an opportunity to be heard before the adjustments were made under Section 143(1). The order of the CIT(A) was set aside.

The Tribunal noted that the assessee did not comply with notices from the CIT(A) on multiple occasions. However, considering the assessee's plea of disability and the request for an opportunity, the Tribunal allowed the appeal for statistical purposes.

The Tribunal set aside the ex-parte assessment order passed by the lower authorities. It granted the assessee one more opportunity to present her case before the Assessing Officer.

The ITAT found the CIT(A)'s order non-speaking and without proper reasoning for disbelieving the assessee's detailed explanation regarding the source of cash from charcoal trading and agricultural income. Consequently, the ITAT accepted the assessee's substantiated evidence and directed the deletion of the addition of Rs. 14,18,000/-.

The Tribunal quashed the reopening proceedings and the reassessment order, finding that the reopening was based on a change of opinion and not on any failure to disclose material facts by the assessee.

The Tribunal condoned the delay in filing the appeal, recognizing that the matter was not examined on merits and denying an opportunity for hearing would cause injustice. The Tribunal set aside the matter to the CIT(A) to allow the assessee another opportunity to present facts and evidence regarding the additions made, particularly concerning cash deposits during demonetisation.

The Tribunal noted that the assessee has opted for the Vivad Se Vishwas Scheme. Recording the submission, the appeal was dismissed with liberty to restore it if the scheme application is not entertained.

The Tribunal found that the assessee had adequately explained the source of cash deposits totaling Rs.11,70,500/-, which included cash sales and withdrawals from the same bank, through a reconciliation statement. Since these explanations were not properly considered, the Tribunal directed the deletion of the Rs.11,02,000/- addition confirmed by the CIT(A).

The Tribunal held that the CIT(A)'s reasons for rejecting the assessee's explanation were not sustainable. The Tribunal found that the assessee had provided a reasonable cause for non-compliance, and there was no infirmity pointed out by the AO or CIT(A) in the explanation.

The Tribunal held that the interests of justice would be served by giving the assessee another opportunity to present their case before the CIT(E). The order of the CIT(E) was set aside.

The Tribunal condoned the delay in filing the appeal. It noted that the name mismatch was a genuine mistake and had been rectified. The Tribunal set aside the order of the Ld. CIT(E) with a cost of Rs. 5,000/-, directing the Ld. CIT(E) to provide fresh opportunity for hearing.

For ITA No.2059/Ahd/2024, the Tribunal held that the CIT(E) did not provide a proper opportunity for the assessee to submit documentary evidence. Therefore, this appeal was remanded back to the CIT(E) for proper adjudication. For ITA No.2060/Ahd/2024, the Tribunal held that the assessee cannot challenge an action initiated by itself, hence this appeal was dismissed.

The Tribunal noted that this was the 16th hearing and the appeal was adjourned multiple times. The Tribunal observed that the assessee was not offered a video hearing despite requesting it. Therefore, to provide natural justice, the Tribunal set aside the order and remanded the matter back to the CIT(A) to provide a video hearing.

The Tribunal held that the interest of justice would be served by giving the assessees an opportunity to present their cases. The impugned orders were set aside and the matters were restored to the Ld.CIT(E).

The Tribunal held that the assessee failed to provide evidence to substantiate the genuineness of the donations. Relying on previous judgments and the findings of the AO and CIT(A), the Tribunal concluded that the donations were likely bogus accommodation entries.

The Tribunal noted that the matter required examination at the primary level. Therefore, the case was remanded to the Assessing Officer to pass a de novo order after a thorough examination of the bank account.

The Tribunal dismissed the appeal as withdrawn based on the assessee's request to participate in the Vivad Se Vishwas Scheme. However, it granted the assessee liberty to seek restoration of the appeal if they are unable to avail the benefits of the scheme for any bonafide reasons.

The Tribunal noted the assessee's submission regarding opting for the Vivad Se Vishwas Scheme. The appeal was dismissed, with liberty to restore it if the scheme application was not entertained.

The Tribunal held that the interest of justice would be served by giving the assessees an opportunity to present their cases. The impugned orders were set aside and the matters were restored to the Ld.CIT(E).

The Tribunal upheld the disallowance, ruling that Form 3CL is a statutory prerequisite for claiming a deduction under Section 35(2AB) for the specific assessment year, and its absence could not be faulted. It noted that the ongoing High Court matter does not warrant setting aside the ITAT order, as Section 153(6) provides for giving effect to court orders at a later stage. The alternative claim under Section 35(1) was also rejected.

The Tribunal held that the Assessing Officer was incorrect in rejecting the books of accounts as the evidence relied upon, primarily the statement of Mayank Khatri, was not properly confronted to the assessee and lacked corroboration. The seller also denied any such transactions.

The Income Tax Appellate Tribunal (ITAT) deleted the addition. It noted that an identical addition made in the hands of a co-owner of the same land was previously deleted by the ITAT (Ahmedabad Bench) on the grounds that the difference between the fair market value and the purchase consideration (approximately 10%) was not a material difference. The ITAT applied the same reasoning, finding the addition unsustainable.

The Tribunal found that the deposits were from milk sales and agricultural income, with no substantial increase compared to earlier years. Concluding that the CIT(A) was incorrect, the entire addition made by the Assessing Officer was deleted.

The Tribunal noted that this was the 25th hearing of the appeal and no one appeared for the assessee. Information was received that the legal representative had expired. Since the appeal could not be prosecuted, the Tribunal dismissed the appeal.

The tribunal acknowledged the assessee's non-compliance but, applying the principle of natural justice, allowed the appeal for statistical purposes. The case was remanded back to the Assessing Officer to redo the assessment, granting the assessee one final opportunity to produce all necessary details and documents on merits, subject to a cost of Rs. 5,000/- for non-cooperation.

The Tribunal acknowledged a delay in filing the appeal and imposed a cost of Rs. 5,000 on the assessee. The CIT(E) was directed to grant one more opportunity of hearing to the assessee for registration.

Considering the assessee's choice to opt for the Vivad se Vishwas scheme, the Tribunal dismissed the appeals as withdrawn. Liberty was granted to approach the Tribunal for revival if the scheme application is rejected.

The Tribunal held that the CIT(A)'s reasoning for rejecting the assessee's plea to set off commission income against surrendered cash was not acceptable. The Department had accepted the cash found during the search as the assessee's undisclosed income. Therefore, the Department could not later argue that the cash pertained to parties from whom it was received. This was considered blowing hot and cold. For AY 2018-19, the commission income of Rs. 12,97,897 related to the period April 1, 2017, to July 11, 2017, which overlapped with the period for which Rs. 71,29,230 was surrendered and accepted by the Department. The Tribunal found that both the surrendered income and the commission income noted in loose papers for this period were likely duplicate. Therefore, the addition of Rs. 12,97,897 for AY 2018-19 was not sustainable, and deletion was directed. However, for AY 2017-18, the commission income of Rs. 8,81,634 was not eligible for set-off against the surrendered income because the surrender was made for AY 2018-19 and pertained to that year, not AY 2017-18. Thus, the addition of Rs. 8,81,634 for AY 2017-18 was confirmed.

The Tribunal held that the Assessing Officer was incorrect in rejecting the books of accounts as the evidence relied upon, primarily the statement of Mayank Khatri, was not properly confronted to the assessee and lacked corroboration. The seller also denied any such transactions.

For ITA No.2059/Ahd/2024, the Tribunal held that the CIT(E) did not provide a proper opportunity for the assessee to submit documentary evidence. Therefore, this appeal was remanded back to the CIT(E) for proper adjudication. For ITA No.2060/Ahd/2024, the Tribunal held that the assessee cannot challenge an action initiated by itself, hence this appeal was dismissed.

The Tribunal held that the addition of Rs. 23,00,000/- on account of on-money receipt was correctly made based on evidence and the assessee's statement. However, the addition of Rs. 1,17,05,820/- was set aside to the Assessing Officer to determine if it represented turnover or income.

Considering the assessee's choice to opt for the Vivad se Vishwas scheme, the Tribunal dismissed the appeals as withdrawn. Liberty was granted to approach the Tribunal for revival if the scheme application is rejected.

The Tribunal held that the Revenue's appeals were dismissed on merits, rendering the assessee's cross-objections regarding the validity of reassessment infructuous. Regarding the merits of the additions, the Tribunal found no infirmity in the CIT(A)'s order. The CIT(A) had correctly appreciated the factual position and rightly deleted the additions made under section 69A. The CIT(A)'s reasoning, which was upheld by the Tribunal, indicated that the AO had failed to conduct independent investigations to corroborate the claim of non-genuine transactions. The assessee had demonstrated actual business income from trading in LHSL, incurring genuine losses/gains in the ordinary course of business as a market intermediary. The AO did not provide evidence of falsified records, cash trails, or financial benefits to the assessee. Specifically for AY 2013-14, the CIT(A) noted the AO's computation of fictitious loss was factually incorrect, as the assessee had earned genuine profits. For AY 2015-16, the CIT(A) found that the assessee had realized genuine profits, and the AO's methodology for computing alleged fictitious loss and gain was factually incorrect. The Tribunal concluded that no credible evidence was brought on record by the AO to establish fictitious transactions or accommodation entries, thus upholding the deletion of additions.

The Tribunal condoned the delay in filing the appeals and, accepting the explanation for non-compliance, set aside both appeals to the CIT(A). The CIT(A) is directed to grant the assessee another opportunity and decide the matters on merits.

The Tribunal held that the CIT(Exemption) had not considered the evidence filed by the applicant. Therefore, the matter was remanded back to the CIT(Exemption) for fresh consideration and to grant an opportunity of hearing.

The Tribunal condoned the delay in filing the appeals and, accepting the explanation for non-compliance, set aside both appeals to the CIT(A). The CIT(A) is directed to grant the assessee another opportunity and decide the matters on merits.

The Tribunal held that the failure to file Form 10-IE within the prescribed due date is directory, not mandatory, and does not invalidate the option exercised under Section 115BAC. Since the option was exercised in the preceding year and not invalidated under sub-section (2), a fresh form was not required in the impugned year.

The Tribunal held that the CIT(A) was unjustified in not condoning the delay, as the assessee had adduced sufficient cause. Furthermore, the addition of Rs.43,49,650/- was unsustainable as the bank accounts in question did not belong to the assessee.

The CIT(A) deleted the additions, finding that the Assessing Officer failed to establish a nexus between the assessee's genuine business transactions and accommodation entries. The Tribunal upheld the CIT(A)'s decision, finding no infirmity in the deletion of additions.

The Tribunal held that the assessment order was invalid as it was passed in the name of a deceased person. The AO was aware of the assessee's death, and therefore, subsequent notices should have been issued to the legal heir.

The Tribunal held that the Revenue's appeals were dismissed on merits, rendering the assessee's cross-objections regarding the validity of reassessment infructuous. Regarding the merits of the additions, the Tribunal found no infirmity in the CIT(A)'s order. The CIT(A) had correctly appreciated the factual position and rightly deleted the additions made under section 69A. The CIT(A)'s reasoning, which was upheld by the Tribunal, indicated that the AO had failed to conduct independent investigations to corroborate the claim of non-genuine transactions. The assessee had demonstrated actual business income from trading in LHSL, incurring genuine losses/gains in the ordinary course of business as a market intermediary. The AO did not provide evidence of falsified records, cash trails, or financial benefits to the assessee. Specifically for AY 2013-14, the CIT(A) noted the AO's computation of fictitious loss was factually incorrect, as the assessee had earned genuine profits. For AY 2015-16, the CIT(A) found that the assessee had realized genuine profits, and the AO's methodology for computing alleged fictitious loss and gain was factually incorrect. The Tribunal concluded that no credible evidence was brought on record by the AO to establish fictitious transactions or accommodation entries, thus upholding the deletion of additions.

The Tribunal found that the nature of the transaction and the actual work done by the assessee needed further verification. Therefore, the appeals were set aside to the Assessing Officer for fresh adjudication after conducting necessary inquiries.

The Tribunal found that the nature of the transaction and the actual work done by the assessee needed further verification. Therefore, the appeals were set aside to the Assessing Officer for fresh adjudication after conducting necessary inquiries.

The Tribunal held that the AO had no basis to make the addition as the amount was received and returned on the same day. The CIT(A) dismissed the appeal for non-compliance without examining merits. The Tribunal also noted that additions were made in the hands of the fund provider.

The Tribunal observed that neither the AO nor the CIT(A) examined the detailed peak credit computation and bank statements provided by the assessee, rejecting the claim summarily without verification. Emphasizing the principles of natural justice, the Tribunal held that it is mandatory for fact-finding authorities to examine all documentary evidence and record a reasoned finding. Therefore, the rejection of the assessee's claim without due verification was unsustainable.

The Tribunal held that the failure to file Form 10-IE within the prescribed due date is directory, not mandatory, and does not invalidate the option exercised under Section 115BAC. Since the option was exercised in the preceding year and not invalidated under sub-section (2), a fresh form was not required in the impugned year.

The Tribunal found that the AO erred in treating the entire cash deposit as income without considering debit transactions. The Tribunal also noted discrepancies in the assessee's cash book entries and directed the AO to re-examine the matter.