ITAT Amritsar Judgments — June 2025

The Tribunal held that a proper re-registration certificate from the Registrar of Societies under the Jammu and Kashmir Societies Registration Act, 1998, in accordance with notification no. 34 of 2019 dated 09.08.2019, was necessary. Since this certificate was pending, the provisions of Rule 17A of the IT Rules, 1962, could not be complied with, and consequently, the application for registration under the IT Act, 1961, could not be proceeded with. Therefore, the Tribunal remanded the matter back to the file of the CIT(E) for fresh consideration after the assessee submits the fresh registration certificate. The Tribunal also directed the assessee to file all other supporting documentary evidence as per queries raised by the CIT(E) to prove the genuineness of its activities and charitable objects. The CIT(E) was directed to provide a reasonable opportunity of being heard and to proceed with the application afresh upon receipt of the registration certificate. The Tribunal explicitly stated that no opinion on merits or legal issues was expressed, and all legal issues were kept open. The same reasoning was applied to the appeal concerning the Section 80G approval.

The Tribunal held that a proper re-registration certificate from the Registrar of Societies under the Jammu and Kashmir Societies Registration Act, 1998, in accordance with notification no. 34 of 2019 dated 09.08.2019, was necessary. Since this certificate was pending, the provisions of Rule 17A of the IT Rules, 1962, could not be complied with, and consequently, the application for registration under the IT Act, 1961, could not be proceeded with. Therefore, the Tribunal remanded the matter back to the file of the CIT(E) for fresh consideration after the assessee submits the fresh registration certificate. The Tribunal also directed the assessee to file all other supporting documentary evidence as per queries raised by the CIT(E) to prove the genuineness of its activities and charitable objects. The CIT(E) was directed to provide a reasonable opportunity of being heard and to proceed with the application afresh upon receipt of the registration certificate. The Tribunal explicitly stated that no opinion on merits or legal issues was expressed, and all legal issues were kept open. The same reasoning was applied to the appeal concerning the Section 80G approval.

The Tribunal found that the claim for deduction under Section 80P(2)(d) regarding interest earned from cooperative banks was not adequately adjudicated. Therefore, the matter was remanded back to the CIT(A) for fresh adjudication.

The Tribunal found that the claim for deduction under Section 80P(2)(d) regarding interest earned from cooperative banks was not adequately adjudicated. Therefore, the matter was remanded back to the CIT(A) for fresh adjudication.

The Tribunal found that the claim for deduction under Section 80P(2)(d) regarding interest earned from cooperative banks was not adequately adjudicated. Therefore, the matter was remanded back to the CIT(A) for fresh adjudication.

The Tribunal held that the addition on a protective basis in the hands of the assessee was not legally justified. The assessee had filed an FIR and criminal proceedings were underway, and the nature of his business and license capacity made such large transactions impossible.

The Tribunal found that the claim for deduction under Section 80P(2)(d) regarding interest earned from cooperative banks was not adequately adjudicated. Therefore, the matter was remanded back to the CIT(A) for fresh adjudication.

The Tribunal held that the assessee's business activities were established and accepted under presumptive taxation in previous years. Considering the opening cash balance, opening inventory, and daily sales, the cash found was sufficiently explained. Therefore, the addition made by the AO was deleted.

The Tribunal observed that a revised Trust Deed was provided to them and acknowledged that the assessee was denied reasonable opportunity by the CIT(E). Consequently, both appeals were remanded to the CIT(E) for fresh adjudication. The CIT(E) was directed to grant the assessee a 30-day window to submit documents and ensure a proper hearing, with no opinion expressed on the merits.

The Tribunal observed that a revised Trust Deed was provided to them and acknowledged that the assessee was denied reasonable opportunity by the CIT(E). Consequently, both appeals were remanded to the CIT(E) for fresh adjudication. The CIT(E) was directed to grant the assessee a 30-day window to submit documents and ensure a proper hearing, with no opinion expressed on the merits.

The ITAT condoned the 117-day delay in filing the revenue's appeal due to technical glitches. It upheld the CIT(A)'s decision, confirming that the assessee's land was indeed used for agricultural purposes for the two years preceding the sale, as evidenced by revenue records (jamabandi). Given that the sale proceeds were fully reinvested in other agricultural land, the assessee is entitled to the exemption under Section 54B, and thus the revenue's appeal was dismissed.

The Tribunal held that the agreement for sale, though unregistered, was valid evidence for the Rs. 10 lakhs advance received. It also accepted the Rs. 6,75,000/- cash deposit as explained from agricultural activities, considering the J-forms and the family's agricultural background.

The Tribunal held that the reassessment proceedings were invalid because the AO recorded incorrect reasons without applying his mind, and the subsequent approval by higher authorities was mechanical. The addition made on account of the bank deposit was deleted.

The Tribunal held that the intimation under Section 143(1) merges with the assessment order under Section 143(3) when the issue is part of the scrutiny assessment. Therefore, the appeal against the Section 143(3) order was valid, and the belatedly filed audit report should be considered.

The Tribunal observed that the assessee was not given a proper opportunity to rebut the CIT(E)'s findings. Therefore, the matter was remanded back to the CIT(E) with directions to issue a show cause notice, allow the assessee to present its case, and then re-adjudicate according to law, after considering all explanations and submissions judiciously. The Tribunal explicitly stated it did not express any opinion on the merits, keeping all legal issues open.

The Tribunal held that the AO initiated reassessment proceedings without proper application of mind and without sufficient reason to believe that income had escaped assessment. The reassessment notice was deemed legally unsustainable due to factual errors and non-application of mind to the evidence.

The Tribunal observed that the CIT(A) had not adjudicated all issues raised by the Assessee. To ensure a clear adjudication, the case was remanded back to the CIT(A) for fresh adjudication on merits, providing the Assessee with a due opportunity of hearing. One appeal (ITA 566/ASR/2024) was allowed for statistical purposes, and the other (ITA 572/ASR/2024) was dismissed as infructuous.

The tribunal noted that the trust's objects were charitable and that visible activities like medical camps and langar were supported by records. It found that the CIT(E) had violated principles of natural justice by not issuing a show cause notice before rejecting the application. Consequently, the tribunal remanded the main appeal (ITA 225/Asr/2024) back to the CIT(E) for fresh consideration, directing the assessee to provide all supporting evidence. A separate appeal (ITA 551/Asr/2024) against a cancellation order was dismissed as infructuous.

The tribunal noted that the trust's objects were charitable and that visible activities like medical camps and langar were supported by records. It found that the CIT(E) had violated principles of natural justice by not issuing a show cause notice before rejecting the application. Consequently, the tribunal remanded the main appeal (ITA 225/Asr/2024) back to the CIT(E) for fresh consideration, directing the assessee to provide all supporting evidence. A separate appeal (ITA 551/Asr/2024) against a cancellation order was dismissed as infructuous.

The Tribunal observed that the CIT(A) had not adjudicated all issues raised by the Assessee. To ensure a clear adjudication, the case was remanded back to the CIT(A) for fresh adjudication on merits, providing the Assessee with a due opportunity of hearing. One appeal (ITA 566/ASR/2024) was allowed for statistical purposes, and the other (ITA 572/ASR/2024) was dismissed as infructuous.

The Tribunal held that the AO initiated reassessment proceedings without proper application of mind and without sufficient reason to believe that income had escaped assessment. The reassessment notice was deemed legally unsustainable due to factual errors and non-application of mind to the evidence.

The Tribunal held that the delay in filing the audit report was due to circumstances beyond the assessee's control (auditor affected by COVID-19) and that the trust substantially fulfilled the conditions for exemption. The delay was condoned.

The Tribunal, considering the assessee's amended Memorandum of Association (MOA), its broad membership base, and activities promoting general public utility, along with relevant precedents, found that the assessee's activities fell within the definition of charitable purpose. It concluded that the activities were not for business but in support of its main object, making it eligible for registration. The appropriate authority was directed to grant the registration.

The Tribunal upheld the disallowances but significantly reduced the amounts. The disallowance for wages was restricted to Rs.2 Lacs (from Rs.20 Lacs). The disallowance for diesel/LDO expenses was restricted to Rs.2 Lacs (from Rs.10.35 Lacs). The disallowance for crusher sand and bajri was restricted to Rs.1 Lac (from Rs.7.05 Lacs). The lump sum addition of Rs.2.50 Lacs for freight and cartage was confirmed as reasonable. The Tribunal considered the assessee's improved net profit rate in the current year compared to previous years when estimating the reduced additions.

The Tribunal observed that necessary documents regarding prior ITAT remands and the status of exemption applications from CIT(E) were not on record. Due to the lack of clarity on whether the AO had received the remanded order and the non-disposal of the exemption application by CIT(E) within six months, the Tribunal decided to remand the entire case back to the Assessing Officer for fresh adjudication on merits after proper verification of all claims and affording the assessee an opportunity of hearing.

The Tribunal first condoned the 89-day delay in filing the appeals, as the Revenue had no objection. On the merits, the Tribunal upheld the CIT(E)'s decision, concluding that the assessee failed to provide sufficient proof that its activities were genuinely charitable and primarily for the benefit of the general public. The Tribunal found that the activities, including seminars and conferences, mainly benefited the association's members and involved networking with pharmaceutical companies, which did not fall under the definition of 'charitable purpose' as defined in Section 2(15) of the Income Tax Act, 1961.

The Tribunal first condoned the 89-day delay in filing the appeals, as the Revenue had no objection. On the merits, the Tribunal upheld the CIT(E)'s decision, concluding that the assessee failed to provide sufficient proof that its activities were genuinely charitable and primarily for the benefit of the general public. The Tribunal found that the activities, including seminars and conferences, mainly benefited the association's members and involved networking with pharmaceutical companies, which did not fall under the definition of 'charitable purpose' as defined in Section 2(15) of the Income Tax Act, 1961.

The Tribunal found that the 'Iqrarnama' did not bear the assessee's genuine signatures, lacked proper identification, and was a third-party document with no established link to the assessee. Since no cross-examination was allowed and the Assessing Officer failed to rebut the handwriting expert's report, the additions made solely on the basis of this unreliable document were deleted. The Tribunal relied on the principle that a person cannot be held accountable for writings made by a third party.

The Tribunal ruled that the assessee was indeed entitled to the registration, noting its long existence, provisional registration, and Articles of Association allowing for diverse membership. It found no evidence of funds being used for non-object purposes and directed the CIT(E) to grant the registration.

The Tribunal observed that the assessee's Articles of Association allowed for a wide spectrum of members and that there were no allegations of spending funds contrary to its objects. It concluded that the assessee was entitled to registration under Section 12A(1)(ac)(iii). The appropriate authority was directed to grant the registration, allowing the revenue to scrutinize fund utilization during assessment.

The Income Tax Appellate Tribunal held that the assessee had sufficiently explained the source of the Rs. 13 Lacs cash. The explanation involved the movement of cash between directors, specifically from an imprest balance held by one director, which was duly reflected in the audited financial statements and further corroborated by a director's statement. Consequently, the Tribunal found the addition made by the AO and confirmed by the CIT(A) to be unsustainable.

The tribunal held that the agreement for Rs.155 Lacs was a 'dumb document' without corroborative evidence, and directed the AO to adopt the actual sale consideration of Rs.90 Lacs. For carry forward of capital losses, citing Special Bench and High Court decisions, the tribunal ruled that claims made in returns filed in response to a Section 153A notice within the allowed time, in abated assessments, must be allowed.