ITAT Chandigarh Judgments — May 2024

The Tribunal held that the assessee should be granted liberty to file a fresh application under Section 80G before the CIT(E) by June 30, 2024. The CIT(E) is to adjudicate the fresh application on its merits after providing an opportunity to the assessee.

The Tribunal upheld the CIT(A)'s deletion of disallowance under Section 14A, following judicial precedents that no disallowance can be made if no exempt income is earned. It also upheld the deletion of disallowance on NPA interest, confirming that Section 43D, as amended, applies to cooperative banks from AY 2018-19, making interest taxable on receipt basis.

The Tribunal held that interest on sticky loans/NPAs should be taxed on a receipt basis, following established judicial precedents and the assessee's consistent accounting practice. The amendment to Section 43D broadening its scope to cooperative societies was noted but the decision was based on existing interpretations and prior rulings.

The Tribunal held that interest on sticky loans/NPAs should be taxed on a receipt basis, following established judicial precedents and the assessee's consistent accounting practice. The amendment to Section 43D broadening its scope to cooperative societies was noted but the decision was based on existing interpretations and prior rulings.

The Tribunal held that the assessee society had provided a reasonable explanation for the nature and source of the deposits, supported by documentary evidence. The CIT(A) was correct in deleting the addition as the requirements of Section 68 were met.

The Tribunal held that the assessee, a retired railway employee, had sufficiently explained the source of the cash deposits during demonetization. The explanation was corroborated by bank statements showing earlier withdrawals and cash flow statements indicating cash-in-hand.

The Tribunal held that the assessee was not a taxable entity until AY 2013-14, as it was considered part of the State Government. Consequently, IDC receipts and interest from FDRs were not taxable for AY 2012-13.

The Tribunal allowed the appeal, quashing the CIT(E)'s order. The assessee was granted liberty to file a fresh application for registration under Section 80G by June 30, 2024, which the CIT(E) was directed to examine on merits.

The Tribunal held that the assessee should be granted liberty to file a fresh application for registration under Section 80G before the CIT(E) by June 30, 2024. The CIT(E) is then to examine the application on its merits.

The Tribunal allowed the assessee to file a fresh application for registration under Section 80G before the CIT(E) by June 30, 2024, in light of a new CBDT circular providing an extended timeline. The CIT(E) was directed to adjudicate the fresh application on its merits.

The Tribunal held that the Ld. CIT(A) should have provided a further opportunity of hearing to the assessee. Despite the assessee's lack of diligence in updating her address, the principles of natural justice require a full and complete opportunity to be heard.

The Tribunal held that Rs. 5,00,000/- paid by the mother-in-law was explained. Rs. 6,00,000/- from FDR maturity and Rs. 84,000/- cash deposit were also explained. However, Rs. 94,870/- from friends and relatives remained unexplained.

The Tribunal deleted the addition of Rs. 4,65,647/- related to interest on share investment, finding that Section 14A was not applicable as no exempt income was earned. The Tribunal also allowed the expenditure of Rs. 4,25,000/- for the distillery project report, considering it as an expense incurred wholly and exclusively for the purpose of business.

The Tribunal allowed the assessee to file a fresh application for registration under Section 80G by June 30, 2024. The CIT(E) was directed to examine the fresh application on its merits.

The Tribunal allowed the assessee to file a fresh application for Section 80G registration by June 30, 2024, in light of a new CBDT circular providing an extended timeline. The CIT(E) was directed to adjudicate the fresh application on its merits.

The Tribunal held that the provisions of the IBC override other laws, including the Income Tax Act. The approved resolution plan, being binding on all creditors including the Income Tax Department, extinguished any claims for periods prior to its approval. Therefore, the Income Tax Department was precluded from pursuing the demand for the assessment year 2011-12.

The Tribunal upheld the lower authorities' decision to reject the assessee's books of account and estimate the net profit at 12%. The failure to provide complete documentation justified the AO's best judgment assessment and the addition of the remaining profit as income from undisclosed sources.

The Tribunal upheld the Assessing Officer's and CIT(A)'s action of treating the surrendered cash as deemed income under Section 69A read with Section 115BBE of the Income Tax Act, 1961. The assessee failed to establish the nexus between the surrendered income and her business.

The Tribunal condoned the delay in filing the appeal due to the COVID-19 pandemic. The ex-parte order was set aside, and the matter was remanded to the PCIT for fresh adjudication after providing the assessee with a reasonable opportunity to be heard.

The Tribunal held that since the initial repayment of Rs. 90,00,000/- was accepted, the remaining repayment should be treated similarly. The matter was set aside to the AO for verification of the remaining repayment.

The tribunal upheld the disallowance of EPF, citing the Supreme Court judgment in the Checkmate case regarding timely deposit. However, the tribunal set aside the addition on closing stock valuation and remanded the matter back to the CIT(A) for a fresh examination on merits, emphasizing the need for detailed analysis and consistency in accounting practices.

The Tribunal held that since the AO had conducted an inquiry, applied his mind, and recorded a finding that the source of the cash deposit was in order, the PCIT could not invoke Section 263 to re-appreciate the facts. The invocation of Section 263 was deemed without legal basis.

The Tribunal held that the surrendered amount related to the ongoing construction of the hotel building, which was an integral part of the assessee's business. Therefore, it should be taxed as business income at normal rates, not under the special provisions for unexplained investments.

The Tribunal granted permission to withdraw the appeal as the assessee had obtained the required registration. The appeal was dismissed as withdrawn.

The Tribunal held that the surrendered amount on account of excess stock should be treated as business income and not as unexplained investment. Consequently, Section 69B and Section 115BBE were not applicable, and normal tax rates should apply.

The Tribunal held that the AO's assessment order was a non-speaking and non-reasoned order, even though it was a scrutiny assessment. The PCIT was justified in exercising powers under Section 263 as the AO failed to conduct proper inquiry and verification of the assessee's claims.

The Tribunal upheld the orders of the lower authorities, confirming the addition of Rs. 7,35,000/- as unexplained cash credit. The belated submission of invoices amounting to Rs. 61,313/- was not accepted as sufficient evidence.

The Tribunal held that profit on sale of capital assets cannot be excluded from book profit for MAT computation. However, the assessee is entitled to the benefit of indexed cost of acquisition while computing such capital gains for MAT purposes.

The Tribunal held that notices must be effectively communicated and not merely placed on the e-portal without ensuring the assessee's knowledge, following the jurisdictional High Court's decision. The impugned order was set aside.

The Tribunal held that in cases of non-abated or completed assessments, additions under Section 153A are not permissible without incriminating material found during a search. Since no such material was found, the additions were deleted.

The Tribunal held that the Assessing Officer (AO) had not properly examined the issue and failed to apply relevant Supreme Court judgments. The interest income earned from cooperative banks was not eligible for deduction under Section 80P(2)(d) as it was not derived from investments with other cooperative societies, and the principle of mutuality was broken.

The Tribunal held that the CIT(A) passed an ex-parte order without providing a reasonable opportunity of being heard to the assessee, as notices were only uploaded on the IT portal and not served on the assessee's email. The assessee was granted another opportunity to represent their case.

The Tribunal held that the rejection order was ex-parte and that proper notice was not served on the assessee, violating principles of natural justice. The matter was restored to the CIT(E) for a decision on merits after providing adequate opportunity.

The Tribunal held that the Assessing Officer (AO) had not properly examined the issue and failed to apply relevant Supreme Court judgments. The interest income earned from cooperative banks was not eligible for deduction under Section 80P(2)(d) as it was not derived from investments with other cooperative societies, and the principle of mutuality was broken.

The Tribunal admitted an additional ground of appeal challenging the validity of the Section 153A assessment due to a survey instead of a search. The Tribunal dismissed the ground challenging the CIT(A)'s enhancement powers but found merit in other grounds.

The Tribunal held that the rejection order was ex-parte and that proper notice was not served on the assessee, violating principles of natural justice. The matter was restored to the CIT(E) for a decision on merits after providing adequate opportunity.

The Tribunal held that no incriminating material was found during the search to support the addition. Since the original assessment was unabated and no incriminating material was found, the addition made by the AO and sustained by the CIT(A) was directed to be deleted.

The Tribunal admitted an additional ground of appeal challenging the validity of the Section 153A assessment due to a survey instead of a search. The Tribunal dismissed the ground challenging the CIT(A)'s enhancement powers but found merit in other grounds.

The Tribunal held that the Assessing Officer (AO) had not properly examined the issue and failed to apply relevant Supreme Court judgments. The interest income earned from cooperative banks was not eligible for deduction under Section 80P(2)(d) as it was not derived from investments with other cooperative societies, and the principle of mutuality was broken.

The Tribunal held that the assessee had sufficiently explained the source of the cash received from her husband, and the jewellery found was either explained as belonging to family members or was within the permissible limits of reasonable holding. Therefore, the additions made by the lower authorities were directed to be deleted.

The Tribunal found that relevant documents supporting the assessee's claim were not considered at any stage. Therefore, in the interest of justice, the matter was remitted back to the CIT(A) for a fresh decision.

The Tribunal held that reopening the assessment based on incorrect facts without proper application of mind and prior inquiry renders the entire reopening process void. Consequently, the assessment framed on the basis of such reopening is also void.

The Tribunal held that as per Rule 30 of the Income Tax Rules, 1962, TDS/TCS deducted for the month of March can be deposited by April 30th. Therefore, the disallowance made by the CIT(A) was not justified.

The Tribunal held that the issue of whether stock is a finished good or scrap is debatable and requires technical knowledge. Therefore, it is not a case of concealment or furnishing inaccurate particulars of income, making the penalty unjustified.

The Tribunal held that the PCIT's order was ex-parte and that the assessee was not given a proper opportunity of being heard. Therefore, the matter was restored to the PCIT for fresh adjudication.

The Tribunal set aside the order of the CIT(Exemptions) and restored the matter to the CIT(Exemptions) to decide the application on merits. This was done considering a subsequent CBDT circular extending the due date for filing such applications.

The Tribunal found that the CIT(A) passed the order without considering the assessee's paperbooks and written submissions, violating principles of natural justice. Therefore, the case was restored to the CIT(A) for a fresh decision.

The Tribunal found that the CIT(A)'s order was passed without giving the assessee a proper opportunity to be heard. Therefore, the order was set aside on the ground of violation of natural justice.

The Tribunal held that since the assessee's books of accounts, including sales vouchers and stock registers, were not rejected by the lower authorities, the cash deposits arising from sales could not be treated as unexplained income. The addition was made on an estimate basis without pointing out any specific discrepancies.

The Tribunal held that the disallowance of employees' contribution to PF/ESI for late deposit beyond the prescribed due date is justified, following the Supreme Court's decision in Checkmate Services P. Ltd. The CIT(A)'s order sustaining the disallowance was confirmed.