ITAT Bangalore Judgments — November 2025

The Tribunal condoned the delay in filing the appeal, considering the assessee's explanation reasonable and noting that no prejudice would be caused to the revenue. The Tribunal decided to hear the appeal on merits.

The Tribunal condoned the delay in filing the appeal, acknowledging the assessee's explanation. Considering that the case was decided ex-parte at both lower levels, the Tribunal remitted the issue back to the AO for fresh consideration.

The Tribunal, in the interest of justice and fair play, granted the assessee one more opportunity to represent their case before the AO, provided they cooperate and avoid adjournments.

The Tribunal noted that a major part of the delay was attributable to the COVID period and directed the CIT(A) to condone this delay in line with Supreme Court rulings. For the remaining delay, considering the assessee's age and educational background, a liberal view was taken, and the delay was condoned with a nominal cost.

The Tribunal found that the assessee had consistently disclosed and the AO had accepted cash balances in previous assessment years (A.Y. 2011-12 to 2014-15), making the current cash deposits explained. The Tribunal ruled that Section 69A was incorrectly invoked as the assessee provided a valid explanation supported by balance sheets. Furthermore, it held that only the net profit component, not gross receipts, from business income could be taxed, and the CIT(A)'s ex parte order violated natural justice. Consequently, the addition of Rs. 67,00,000/- under Section 69A and the application of Section 115BBE were deemed unsustainable.

The Tribunal held that the cash deposits were explained by the assessee's business receipts and accumulated cash from earlier years, which were accepted by the Department. The AO's addition under section 69A and the application of section 115BBE were deemed unsustainable. The order of the CIT(A) was also criticized for being ex parte.

The Tribunal held that for invoking Section 68, it is a prerequisite that the sum is credited in the books of account maintained by the assessee, and the assessee fails to offer a satisfactory explanation. Since the AO himself was satisfied that no books of account were maintained, the addition u/s 68 could not survive. Furthermore, the source of the deposit was explained as being from Shri D.S. Nandish. Consequently, the grounds raised by the assessee were allowed.

The Tribunal held that additions under Section 68 of the Act cannot be made if the assessee has not maintained books of account. The Tribunal also noted that the source of cash deposit was explained by Shri D.S. Nandish.

The Tribunal held that the Assessing Officer was obligated to record a separate satisfaction note for each assessment year, not a consolidated one. The use of a consolidated satisfaction note vitiated the assessment proceedings.

The Tribunal held that the addition made by the AO on account of unexplained investment could not be sustained as the fixed deposits arose from earlier years and were reinvested. However, the Tribunal restored the limited issue of ₹47,34,431 shown in the balance sheet to the AO for verification.

The Tribunal held that it was appropriate in the interest of justice to grant the assessee another opportunity to present their case before the CIT(A). The order of the CIT(A) was set aside, and the matter was remanded for fresh adjudication.

The Tribunal held that the cash deposits were explained by the assessee's business receipts and accumulated cash from earlier years, which were accepted by the Department in prior assessment years. The AO's addition of Rs. 67 Lakhs under Section 69A and the application of Section 115BBE were deemed unsustainable.

The Tribunal condoned the delay of 267 days, finding merit in the assessee's contention that relevant documents were not considered by the CIT(A) due to the non-appearance. The CIT(A)'s order was set aside, and the case was remanded for adjudication afresh after granting the assessee a reasonable opportunity of being heard.

The tribunal held that the cost of acquisition for capital gains calculation should be based on a specific rate per sq.ft. derived from the JDA. It also ruled that exemption under Section 54 should be allowed considering a higher percentage of substantiated expenses, and notional rent addition for unsold properties due to the pandemic was deleted. For AY 2007-08, the tribunal decided that the transfer from the firm to partners and the subsequent JDA were separate transactions, and the period of holding by co-owners was short, thus qualifying as short-term capital gains.

The Tribunal held that the amendment to Section 32 of the Act, excluding goodwill as a depreciable asset, was prospective and applicable from Assessment Year 2021-2022. It restored the issue of depreciation on goodwill to the AO for fresh adjudication. Regarding free of cost assets, the Tribunal directed the AO to delete additions if the Assessee could establish re-export or destruction of such assets. For Section 40(a)(i), the issue was restored to the AO for fresh verification of TDS certificates.

The Tribunal held that for a Section 153A assessment to be sustained, incriminating material found during the search must be present. The Tribunal noted that the second search did not unearth any new material to justify the additions. The assessee's concession of income from cash payments was on the basis of a bona fide error, and the Revenue could not take advantage of this mistake. The Tribunal also found that the CIT(A) misapplied a Supreme Court decision and failed to consider the principles of natural justice.

The Tribunal held that the Assessing Officer was obligated to record a separate satisfaction note for each assessment year, not a consolidated one. The assessment framed under Section 153C read with Section 143(3) was deemed unsustainable due to this procedural defect.

The Tribunal held that the Assessing Officer was obligated to record a separate satisfaction note for each assessment year, not a consolidated one. The consolidated satisfaction note vitiates the assessment proceedings.

The Tribunal partially allowed the appeal for AY 2021-22, directing a revised computation of cost of acquisition and sale consideration for capital gains, and deleted the addition of notional rent. For AY 2007-08, the Tribunal held that the capital gains were short-term as the asset was held by co-owners for less than 36 months and dismissed the appeals.

The Tribunal held that if investments made in cooperative banks are out of compulsion under the Karnataka Co-operative Societies Act, then the interest income received would be considered business income eligible for deduction under Section 80P(2)(a)(i). Furthermore, even if not eligible under 80P(2)(a)(i), interest income earned from cooperative banks is eligible for deduction under Section 80P(2)(d) as the assessee is a registered cooperative society and not a banking institution.

The Tribunal held that the Assessing Officer was obligated to record a separate satisfaction note for each assessment year under Section 153C. A consolidated satisfaction note for multiple assessment years vitiates the assessment proceedings. Therefore, the assessments framed were not sustainable.

The Tribunal held that the Assessing Officer was obligated to record a separate satisfaction note for each assessment year, not a consolidated one, as per the provisions of Section 153C of the Income Tax Act. Relying on a jurisdictional High Court judgment, the assessment framed was deemed unsustainable.

The Tribunal held that the Assessing Officer was obligated to record a satisfaction note for each assessment year as per Section 153C of the IT Act. Since a consolidated note was used, the assessment framed was not sustainable.

The Tribunal held that Infosys Ltd. and 360 Logica are not comparable to the assessee due to functional dissimilarity and turnover differences. It also directed the exclusion of Nihilent Ltd. and Cybage Software Pvt. Ltd. based on lack of segmental information and functional dissimilarity. The Tribunal allowed the revenue's ground for inclusion of Cadsys (India) Ltd. after finding the assessee's margin to be within arm's length even with its inclusion. The TPO was directed to recompute the ALP as per the directions.

The Tribunal held that the Final Assessment Order was passed in violation of Section 144C(3) and (4) of the Act because it was issued before the expiry of the 30-day period for filing objections, thus frustrating the assessee's right to do so. The CIT(A)'s order was also noted to have accepted the assessee's contention regarding the TPO's order being the effective appeal.

The Tribunal held that the land was a capital asset and advances received under JDA were not taxable. For the interest expenditure, it was found to be genuine, used for business purposes, and a timing difference, thus not warranting disallowance.

The Tribunal held that the income from the Joint Development Agreement was not taxable as business income in the year of advance receipt, aligning with previous ITAT rulings. Regarding interest expenses, the Tribunal found the disallowance unsustainable as the expenditure was genuine, business-related, and the issue was merely a timing difference with no actual revenue impact.

The Tribunal held that income from JDA is not taxable as business income as the assessee's role was limited to contributing land. Regarding interest expenditure, the Tribunal held it to be revenue expenditure as it was for business purposes and genuine, and disallowance would only cause timing differences without affecting the ultimate tax liability.

The Tribunal upheld the order of the Pr.CIT, agreeing that the disallowance of employee's contribution to PF/ESI was justified as per Supreme Court judgment. The Tribunal also directed verification of TDS deduction on professional services and rent payments.

The Tribunal held that the issue of land development income was covered by previous orders in the assessee's own case. Regarding the interest expenditure, the Tribunal noted that it was genuine, for business purposes, and the disallowance led to a timing difference without affecting the overall tax impact. Therefore, the addition was deleted.

The Tribunal held that income from JDA is not taxable as business income in the year of advance receipt, but upon execution of the sale deed. Regarding interest expenditure, the Tribunal held it was a genuine business expense, and its disallowance led to a timing distortion without actual revenue impact.

The Tribunal held that additions under section 153A cannot be made without incriminating materials if the original assessment was completed. The Tribunal also remitted the issue of telescoping benefit of excess income offered to the AO and the issue of disallowance under section 14A for denovo consideration.

The Tribunal held that additions in assessment made u/s. 153A cannot be made without incriminating materials, especially for unabated assessments. The Tribunal also remitted the issue of telescoping benefit of excess income and the disallowance u/s. 14A for fresh consideration by the AO.

The Tribunal held that additions made under section 153A of the Act in respect of lease rent and amortization of building cost could not be made without incriminating materials seized during the search, especially when the assessment was already completed and the issues were disclosed in the original return. Regarding the adhoc addition based on the MD's statement, the Tribunal decided to remit the issue to the AO to consider the telescoping benefit of excess income offered in other assessment years. Similarly, the disallowance under section 14A was remitted for denovo consideration, with a clarification on the satisfaction requirement.

The Tribunal held that additions in the assessment under Section 153A could not be made in the absence of incriminating materials seized during the search, especially when the original assessments were completed. The Tribunal also remitted the issue of telescoping benefit of excess income and the disallowance under Section 14A for fresh consideration.

The Tribunal held that the addition made by the AO under Section 68 was not sustainable as the assessee had recorded all sales in its books of account, which were produced and not rejected. The Tribunal noted that the sales were offered to tax under the head 'income from business' and applying Section 68 would lead to double taxation.

The Tribunal noted that the case was decided ex-parte at the CIT(A) level due to non-prosecution and that the AO had not properly considered the assessee's submissions. Therefore, the Tribunal remitted the issue back to the AO for fresh consideration.

The Tribunal held that the AO's issuance of notice under Section 148A(b) was defective as it did not provide the mandatory 7 days for objections. Furthermore, the reassessment under Section 147 was deemed bad in law due to procedural irregularities. The Tribunal also found that the assessee was entitled to deduction under Section 54 as she reinvested sale proceeds in a more valuable property.

The Tribunal held that the AO ought to have deleted the addition as the assessee had provided cash flow statements, bank statements, and explained the sources of cash deposits, including gifts and withdrawals for starting a new business. The addition was considered ad-hoc and not based on sound principles.

The Tribunal held that the AO and CIT(A) erred in treating the entire cash deposits as unexplained credit without considering the assessee's business nature. The Tribunal directed the AO to consider the deposits as gross receipts from the fruit business and compute income at 8% net profit, also allowing savings bank interest and the deduction u/s 80TTA.

The Tribunal held that the non-issuance of a notice under Section 143(2) of the Income Tax Act, 1961, after the assessee filed a return in response to a notice under Section 148, is a jurisdictional defect and fatal to the reassessment proceedings. The reliance on Section 292BB was held to be misplaced as it cures defects in service, not in issuance. Therefore, the assessment orders passed under Section 144 r.w.s. 147 were quashed.

The Tribunal held that for an addition to be made pursuant to a search, it must be strictly based on incriminating material found during the search. The Tribunal found no reference to any such material in the assessment order. The Tribunal also noted that a statement recorded under Section 132(4) without corroborating incriminating material cannot be considered incriminating material itself. Therefore, the addition made was not based on any incriminating material.

The Tribunal condoned the 52-day delay in filing the appeal, considering the assessee's ill health. It was held that since both the assessment order and the CIT(A)'s order were ex-parte, and considering the need for substantial justice, one more opportunity should be granted to the assessee.

The Tribunal held that the AO's failure to issue a statutory notice u/s 143(2) after the assessee requested their original return be considered in response to the notice u/s 148 was fatal. This omission is not a procedural irregularity that can be cured and renders the assessment proceedings void ab initio.

The Tribunal held that the assessee has the option to choose the valuation method for determining the fair market value of shares. The AO erred in discarding the DCF method chosen by the assessee and adopting the NAV method. The addition made by the AO was directed to be deleted.

The Tribunal held that interest earned on surplus funds invested, which were not immediately required for the society's core business of providing credit facilities, should be treated as income from other sources and not eligible for deduction under Section 80P(2)(a)(i).