ITAT Bangalore Judgments — May 2025

The Tribunal upheld the Ld. CIT(A)'s decision, confirming that BDA's activities are charitable in nature, not commercial, and thus it is eligible for exemption under Sections 11 and 12. The Tribunal affirmed that the proviso to Section 2(15) does not apply to the assessee and dismissed the revenue's appeals against the various disallowances made by the AO on the premise of the assessee's non-charitable status.

The Tribunal held that the CIT erred in rejecting the registration solely based on the quantum of employee expenses without providing an opportunity to justify them. The Tribunal also noted that justification of expenditure is typically considered during assessment proceedings, not at the registration stage. However, regarding medical expenses, the Tribunal remitted the issue to the CIT for verification of details concerning beneficiaries and distribution.

The Tribunal held that the assessee's activities are charitable in nature and are not hit by the proviso to Section 2(15) of the Income Tax Act. The Tribunal relied on previous decisions in the assessee's own case and other similar cases, establishing that the primary object of the assessee is development and public utility, not profit-making. Therefore, the assessee is eligible for exemption under Section 11 of the Act.

The Tribunal noted that the assessee was not provided with a reasonable opportunity to be heard or file written submissions before the CIT(A). Considering the assessee's undertaking to provide documentary evidence, the Tribunal set aside the orders of both lower authorities and remitted the case to the Assessing Officer for denovo consideration.

The Tribunal held that the CIT(E) did not dispute the charitable nature of the trust's objects. It found that employee benefit expenses were incurred for the trust's objectives and that the justification of expenditure should be considered during assessment proceedings, not at the registration stage. Regarding medical expenses, the Tribunal noted that while details of beneficiaries were not initially provided, the trust purchased medicines for the underprivileged based on doctor's prescriptions, which aligns with its objects.

The Tribunal held that the CIT(A) order was not a speaking order and lacked sufficient reasoning to deny condonation of delay. The appeals were set aside and remitted back to the CIT(A) for a fresh consideration of the condonation application and a decision on merits.

The Tribunal held that the assessee's activities were charitable in nature and not hit by the proviso to Section 2(15). Relying on previous decisions in the assessee's own case and other similar urban development authorities, the Tribunal found that the predominant object was planned urban development and social welfare, not profit generation. Consequently, the assessee was eligible for exemption under Section 11 of the Act.

The Tribunal held that the addition on account of unexplained credits to the capital account needs to be verified afresh by the AO, by re-examining the agricultural income claims. Regarding sundry creditors, the Tribunal deleted the addition made under Section 41 of the Act, stating that there was no remission or cessation of liability.

The Tribunal found that the CIT(A)'s order was not a speaking order and the reasons for not condoning the delay were cryptic. The Tribunal set aside the CIT(A)'s order and remitted the case back to consider the condonation application afresh and then decide the appeal on merits.

The Tribunal held that the AO has the right to examine factual details like the number and category of members to determine eligibility for deduction under Section 80P, as it impacts the principle of mutuality. The Tribunal directed the AO to re-examine the issue of member classification and the eligibility of interest income from FDs, particularly statutory deposits.

The Tribunal set aside the order of the CIT(A) and remitted the issue to the Assessing Officer for de novo consideration. The Tribunal granted the assessees an opportunity to appear before the AO with necessary documents within 90 days.

The Tribunal held that the E-stamping commission from non-members was a minor fraction of the total income and did not disentitle the assessee from the deduction. It further held that interest income from deposits made to meet statutory requirements was operational income and eligible for deduction.

The Tribunal noted the peculiar financial circumstances of the company and the assessees. Considering the ground that necessary documents could not be filed due to reasons beyond their control, the Tribunal granted an opportunity to the assessee.

The Tribunal found that the CIT(A)'s finding regarding the assessee's ineligibility for Section 44AD was incorrect, as the CPC had accepted the presumptive income initially. The Tribunal also noted that the core issue was whether the income was added twice by the CPC.

The Tribunal noted the financial difficulties faced by the company and the assessees' efforts to support it. Recognizing that the assessees had issues in furnishing all necessary documents due to circumstances beyond their control, an opportunity was granted for denovo consideration by the AO.

The Tribunal held that the assessment proceedings under Section 153C were vitiated due to jurisdictional and procedural lapses. Specifically, the mandatory condition of recording a satisfaction note by the Assessing Officer of the searched person was not met, and prior approval under Section 153D was not obtained. Therefore, the assessment orders were considered without jurisdiction and liable to be quashed.

The Tribunal set aside the issues to the AO for fresh examination. The AO was directed to verify the proportion of associate members in light of Section 18 of the KCS Act and to examine the statutory obligations for FDs to determine eligibility for deduction on interest income.

The Tribunal condoned a 290-day delay in filing the appeal. It directed the Assessing Officer (AO) to verify whether the interest on borrowed money, for which indexed cost was claimed, had already been claimed as a deduction under Section 24(b) or any other head of income in the current or preceding years, to prevent any double deduction as per the established legal principle. The appeal was allowed for statistical purposes, remanding the issue to the AO for necessary verification.

The Tribunal acknowledged the assessee's illiteracy and ailments as valid reasons for non-compliance and granted an opportunity to substantiate the claim for exemption. The orders of the AO and CIT(A) were set aside and remitted for denovo consideration.

The Tribunal held that the assessment orders passed under Section 153C of the Income-tax Act, 1961, were without jurisdiction due to non-compliance with mandatory conditions, specifically the absence of a recorded satisfaction note and the lack of incriminating material belonging to the assessee. Consequently, the assessment orders were quashed.

The Tribunal held that the assessee, operating under the Karnataka Cooperative Societies Act, is eligible for Section 80P deduction. The presence of nominal and associate members, permitted by law and not breaching mutuality, does not disqualify the deduction. Interest income from FDRs needs verification regarding mandatory requirements.

The Tribunal held that the assessment proceedings under Section 153C were vitiated due to jurisdictional and procedural lapses, specifically the absence of a recorded satisfaction note by the Assessing Officer of the searched person. It was also noted that the mandatory approval under Section 153D was not produced. Consequently, the assessment orders were quashed.

The Tribunal condoned the delay, acknowledging the COVID-19 related issues. It noted factual gaps and incomplete examination at the assessment stage regarding interest payables and TDS. The Tribunal set aside the order and restored the matter to the AO for fresh examination.

The Tribunal noted that the assessees faced financial difficulties and had reasons beyond their control for not providing complete documentation. An opportunity was granted to the assessees to appear before the AO with necessary documents for de novo consideration.

The Tribunal held that the assessee had not wilfully omitted to file objections and that penalizing for technical violations was not appropriate. The DRP should have remitted the issue to the AO for consideration of additional evidence.

The Tribunal found that while the assessee failed to provide evidence earlier, granting one more opportunity in the interest of justice would be appropriate. The matter was restored to the AO for fresh adjudication.

The Tribunal held that the CIT(A) failed to pass a speaking and reasoned order as mandated by Section 250(6) of the Income Tax Act, 1961, by dismissing the appeal without considering the merits. The Tribunal granted one more opportunity to the assessee.

The Tribunal condoned the 99-day delay in filing the appeal, relying on the judgment of Collector, Land Acquisition Vs. Mst. Katiji. It observed that the CIT(E) rejected the application for non-compliance without examining the documents already submitted by the assessee. The matter was remitted back to the CIT(E) for fresh consideration, directing the CIT(E) to provide reasonable opportunity, and the assessee to comply with notices, with no further leniency for subsequent failure.

The Tribunal held that the assessee's application was rejected without an effective opportunity of hearing. Therefore, the appeal was allowed, setting aside the CIT(E)'s order and restoring the matter for fresh adjudication.

The Tribunal condoned the delay in filing the appeal due to sufficient and reasonable cause. It set aside the orders of the AO and CIT(A) and restored the matter to the AO's file, granting the assessee another opportunity to present their case and provide necessary documentation.

The Tribunal held that the assessee failed to provide valid reasons and supporting documents to condone the inordinate delay of 7 years in filing the appeal before the CIT(A). Consequently, the appeals were dismissed.

The Tribunal, in the interest of justice, set aside the CIT(A)'s order and restored the matter to the CIT(A)'s file for a fresh adjudication on merits after giving the assessee an opportunity to be heard.

The Income Tax Appellate Tribunal (ITAT) held that the CIT(E) erred in rejecting the application without affording proper opportunity to the assessee. It recognized that initial years might involve preparatory work and activities might not be substantial. The ITAT set aside the CIT(E)'s order and remanded the matter for fresh consideration, directing the CIT(E) to provide due opportunity to the assessee to furnish details and explanations.

The Tribunal held that the CIT(A) failed to comply with Section 250(6) of the Income Tax Act by not passing a speaking and reasoned order after affording an opportunity of being heard. The impugned orders were set aside.

The Tribunal held that the assessee is entitled to the statutory 15% accumulation of income under Section 11(1) without conditions, allowing this claim. However, the issue of accumulation under Section 11(2) was remanded to the AO for fresh consideration, allowing the assessee an opportunity to explain the delay in filing the return and Form 10B.

The Tribunal held that the assessee failed to provide valid reasons or supporting documents for the inordinate delay in filing the appeal before the CIT(A). Consequently, the delay could not be condoned, and the appeals were dismissed.

The Tribunal held that the AO made additions without confronting the investigation report and without a proper basis for estimating the rent. The rent received was found to be more than the BBMP rate, and the property was given to the son out of love and affection.

The Tribunal observed that no valid reasons or supporting documents were provided by the assessee to condone the inordinate delay of 7 years in filing the appeal before the CIT(A). Consequently, the Tribunal found no other option but to dismiss the appeals.

The Tribunal held that since the bank account was already disclosed and no fresh tangible material was brought on record by the Revenue to demonstrate escapement of income, the reopening of the assessment was without valid jurisdiction.

The Tribunal noted that the CPC and CIT(A) proceeded on the premise that the assessee claimed exemption under Section 11, which requires 12AA registration. However, the assessee claimed exemption under Section 10(23C)(iiiad), which has different conditions and does not mandate 12AA registration.

The Tribunal held that a claim for deduction under section 80P must be made in a valid and timely filed return of income. Since the assessee failed to meet this mandatory pre-condition, the deduction cannot be allowed.

The Tribunal condoned the delay in filing the appeal and decided to grant one more opportunity to the assessee. The order of the Ld.CIT(A) was set aside, and the issue was remitted back to the Ld.CIT(A) for fresh adjudication.

The Tribunal held that the CIT(A) erred in admitting additional evidence without giving the AO an opportunity for rebuttal, as required by Rule 46A of the Income Tax Rules. The Tribunal allowed the Revenue's appeal on this ground.

The Tribunal set aside the assessment and remitted the issue of the assessee's residential status to the AO for de novo assessment. Similarly, the issue of dividend income's eligibility for deduction as a non-resident was also remitted for fresh consideration.

The ITAT found that the revenue authorities had not specifically queried the assessee regarding patient selection criteria. Consequently, the tribunal set aside the matter to the CIT (Exemptions) for fresh verification, directing the assessee to submit all necessary details, particularly concerning patient selection criteria.

The Tribunal held that there is no prohibition on trustees being directors of the hospital and that treatment being provided solely at the assessee's hospital is not a ground for rejection. However, to ensure fair play and in the interest of justice, the matter was set aside to the CIT for fresh verification of the patient selection criteria.

The Tribunal held that treating gross receipts as unexplained income is contrary to settled jurisprudence and that outright rejection of agricultural income claim without inquiry is unwarranted. It found merit in the assessee's request for a fresh opportunity.