ITAT Chandigarh Judgments — January 2026

The Tribunal held that the assessee had substantially explained the cash and jewellery with supporting documents, and the AO's rejections were without sound logic or independent inquiry. Therefore, the additions were not sustainable.

The Tribunal ruled that the addition made by the AO was based solely on extrapolation without any corroborative incriminating material for AY 2022-23, which is not permissible in search assessment proceedings. Citing judicial precedents, the Tribunal emphasized that additions must be restricted only to the extent of evidence found during the search, thereby deeming the impugned addition unsustainable in law.

The Tribunal deleted additions related to payments to M/s Jia Diamond, gold jewellery and bars, payments to Shri Sunil Bansal, alleged cash payment for land, and the purchase of a Mercedes car. It also allowed telescoping for cash found in AY 2023-24 against sustained business income.

The Tribunal held that the assessee had substantially explained the cash and jewellery with supporting documents, and the AO's rejections were without sound logic or independent inquiry. Therefore, the additions were not sustainable.

The Tribunal observed that the assessee had indeed withdrawn more than Rs. 11 lacs from their bank account in September 2016, approximately two months before demonetization. Concluding that it was humanly probable for this amount to have been held by the assessee and subsequently re-deposited, the Tribunal found no justification for the addition made by the AO. Consequently, the addition of Rs. 7,26,090 was deleted.

The Tribunal deleted additions related to payments to M/s Jia Diamond, gold jewellery and bars, payments to Shri Sunil Bansal, alleged cash payment for land, and the purchase of a Mercedes car. It also allowed telescoping for cash found in AY 2023-24 against sustained business income.

The Tribunal held that the Revenue Authorities (AO and CIT(A)) erred by doubting the genuineness of the allotment letters without conducting any inquiry or issuing a notice to the selling company. It clarified that an allotment letter creates a capital right, similar to an agreement to sell, and any amount earned from relinquishing such rights is a capital receipt. Consequently, additions made based on mere self-assumptions and presumptions by the Revenue, without verification or evidence, are not sustainable.

The Tribunal deleted additions related to payments to M/s Jia Diamond, gold jewellery and bars, payments to Shri Sunil Bansal, alleged cash payment for land, and the purchase of a Mercedes car. It also allowed telescoping for cash found in AY 2023-24 against sustained business income.

The Tribunal deleted additions related to payments to M/s Jia Diamond, gold jewellery and bars, payments to Shri Sunil Bansal, alleged cash payment for land, and the purchase of a Mercedes car. It also allowed telescoping for cash found in AY 2023-24 against sustained business income.

The Tribunal dismissed the revenue's appeal, upholding the CIT(A)'s deletion of the penalty. It was held that the show-cause notices issued by the AO u/s 274 r.w.s. 271 were vague as they failed to specifically indicate whether the penalty was for concealment of income or furnishing inaccurate particulars of income. Following established legal precedents, such non-specification vitiates the penalty proceedings, rendering the penalty unsustainable on legal grounds.

The Tribunal held that the CIT(A)'s order was unsustainable because it was passed without providing the assessee a full opportunity to file submissions. Therefore, the impugned order was set aside, and the matter was remitted back to the CIT(A) for a fresh decision on merits after granting due opportunity of hearing to the assessee.

The Tribunal condoned the significant delay in filing the appeal, noting that the assessment order was passed against a deceased person and the bank account in question was opened after his death. The Tribunal also deleted the addition made by the AO, finding it unsustainable.

The Tribunal held that the addition of unutilized LTCG could not be made in AY 2013-14 but should be taxed in the previous year when the three-year utilization period expires, thus deleting the addition. However, the Tribunal upheld the re-opening of the assessment, finding that the assessee had failed to disclose fully and truly all material facts regarding the LTCG, which constituted fresh information for the AO.

The Tribunal found that the error in selecting the sub-clause of Section 12A(1)(ac) was merely a selection error and set aside the impugned orders. It directed the CIT(E) to grant an opportunity of hearing, allow the assessee to correct the registration, and re-consider the 80G(5) application.

The Tribunal found that the error in selecting the sub-clause of Section 12A(1)(ac) was merely a selection error and set aside the impugned orders. It directed the CIT(E) to grant an opportunity of hearing, allow the assessee to correct the registration, and re-consider the 80G(5) application.

The Tribunal upheld the CIT (A)'s decision, finding no error in the order. It observed that the First Appellate Authority is empowered under Section 251(1)(a) to set aside an ex-parte assessment and remit the issue to the AO for fresh adjudication on merits. Consequently, the Revenue's appeal was dismissed.

The Tribunal upheld the CIT(A)'s decision, noting that the issue was covered by its own consistent past judgments for earlier assessment years where it was held that employees of the Department of Urban Estates were working fully for HUDA due to transfer of functions, making their salaries an allowable business expenditure. The Tribunal found no error in the CIT(A)'s order.

Following precedents from the Punjab & Haryana High Court and an earlier Tribunal decision on identical facts, the Tribunal held that the notice issued by the jurisdictional AO was without jurisdiction. Consequently, the re-assessment order was quashed.

The Tribunal found that the assessee had sufficient bank balance and had withdrawn funds from a house sale. It ruled that the Revenue could not disbelieve the assessee's supported explanation without proving the cash was used for other purposes, deeming the Revenue's expectations improbable. The appeal was allowed, and the addition deleted.

Citing a similar case where additions based on uncorroborated evidence from a third-party search were deleted due to denial of cross-examination, the Tribunal found no credible material from the AO to prove the assessee paid on-money and thus deleted the additions for both assessment years. However, the reopening of assessment for AY 2016-17 was held valid as the AO had formed a reasonable belief based on information from the Investigation Wing.

The Income Tax Appellate Tribunal (ITAT) upheld the CIT(A)'s decision, noting that the AO had failed to conduct a judicious inquiry and had ignored the principles of framing an ex-parte assessment. The Tribunal concurred that the cash was collected by the assessee in a fiduciary capacity as per an agreement with Bharti Airtel Ltd., and therefore, did not constitute unexplained money. The appeal filed by the Revenue was dismissed.

The Tribunal held that since the assessee had sufficient interest-free funds exceeding the investments and advances, no interest disallowance under Section 36(1)(iii) and Section 14A was warranted, except for Rs.1,42,842/- representing administrative expenses under Rule 8D(iii). Regarding the foreign travel expenses, the Tribunal found that the AO failed to appreciate the business exigency given the assessee's substantial turnover, thereby deleting the disallowance.

The Tribunal upheld the CIT(A)'s decision to delete the penalty, reasoning that if the underlying addition which formed the basis of the penalty is extinguished by an appellate order, then no penalty is computable. Since the genesis of the penalty (the ex-parte assessment order) was set aside, the penalty could not survive. The appeal filed by the Revenue was therefore dismissed.

The Commissioner of Income Tax (Appeals) deleted the addition made by the AO. The Tribunal is hearing an appeal by the Revenue against this deletion.

The Tribunal dismissed the Revenue's appeal, affirming the CIT(A)'s decision. It noted that ITAT Amritsar had already restored the assessee's registration under Section 12AA on June 29, 2015, for the same assessment year, confirming its status as a ‘Charitable Institution'. The Tribunal ruled that the AO was bound by the ITAT's order and correctly directed to grant exemption under Section 11 to the assessee.

The Tribunal, following its own precedent and a jurisdictional High Court judgment, held that a notice issued under Section 148 or 148A(1) by a jurisdictional AO after the 29.03.2022 notification mandating faceless assessments is without jurisdiction. Consequently, the Tribunal quashed the reassessment order based on such an invalid notice.

Citing a similar case where additions based on uncorroborated evidence from a third-party search were deleted due to denial of cross-examination, the Tribunal found no credible material from the AO to prove the assessee paid on-money and thus deleted the additions for both assessment years. However, the reopening of assessment for AY 2016-17 was held valid as the AO had formed a reasonable belief based on information from the Investigation Wing.

The Tribunal condoned the 390-day delay in filing the appeal before it, acknowledging the assessee's genuine hardship and applying a liberal interpretation of "sufficient cause" based on Supreme Court precedents. The Tribunal also held that the CIT(A) ought to have condoned the 54-day delay in the first appeal, as the penalty was disproportionate to the negligence. Consequently, it set aside the CIT(A)'s order and remanded the matter to the CIT(A) to decide the appeal on merits after providing due opportunity to the assessee.

The Tribunal held that the addition was unsustainable as it was based solely on an uncorroborated excel sheet from a third party without independent verification or opportunity for cross-examination. The reopening was also found to be bad in law due to lack of independent application of mind and failure to disclose material facts.

The Tribunal held that once the jurisdictional High Court had set aside the foundational assessment order and the notice for initiating penalty, the penalty proceedings, being consequential, could not survive independently. It affirmed that the Assessing Officer lacked jurisdiction to pass the penalty order and the CIT(A) erred in sustaining it even partly. Consequently, the penalty of Rs. 89,22,970/- levied under Section 270A was quashed in its entirety.

The Tribunal, following its own precedent and jurisdictional High Court judgments, ruled that a Section 148 notice issued by a jurisdictional Assessing Officer after the 29.03.2022 notification was without jurisdiction. Consequently, the re-assessment order passed was deemed unsustainable and quashed.

The CIT(A) set aside the ex-parte assessment and remanded the case to the AO for fresh adjudication, allowing for consideration of new evidence presented during the appeal. The Tribunal upheld this decision, noting the amendment to Section 251(1)(a) permits such remands for ex-parte assessments under Section 144, especially when fresh evidence requires verification at the primary stage.

The Income Tax Appellate Tribunal (ITAT) observed that while the JCIT(A) had issued multiple notices, it was unclear if they were served, and crucially, the case was not decided on its merits. Upholding the principle of natural justice, the ITAT set aside the JCIT(A)'s order and remanded the matter back for fresh adjudication, instructing the JCIT(A) to provide proper opportunity to the assessee.

The Tribunal held that interest received under Section 28 of the Land Acquisition Act is not taxable income but a part of compensation. The AO's belief that income had escaped assessment was based on a misinterpretation of Supreme Court judgments, leading to the quashing of the reassessment.

The Tribunal held that the CIT(Exemptions) failed to examine the assessee's plea regarding technical glitches causing the delay and also did not provide an effective opportunity to rebut adverse findings on merits. The matter was remanded for fresh adjudication.

The Tribunal found that the CIT(A) failed to properly examine whether the Section 148 notice had the requisite approval from the Pr. Commissioner of Income Tax and did not pass a speaking order regarding the genuineness and creditworthiness of the share application money lenders. Consequently, the Tribunal set aside the CIT(A)'s order and remanded the matter for a fresh decision on these specific issues.

The Tribunal dismissed the assessee's appeals, following the decision of the Hon'ble High Court which was against the assessee on similar issues. The assessee was granted liberty to approach the AO once the Supreme Court decision is out.

The Tribunal held that the CIT(A)'s decision to remand the case to the AO under Section 251(1)(a) was in conformity with the legal provisions of the Income Tax Act. Therefore, finding no error in the CIT(A)'s order of remand, the appeal filed by the Revenue was dismissed.

The Tribunal dismissed the assessee's appeals, following the decision of the Hon'ble High Court which was against the assessee on similar issues. The assessee was granted liberty to approach the AO once the Supreme Court decision is out.

The Tribunal found that the CIT(A) had passed an ex-parte order without giving any findings on merit. To uphold the principles of natural justice, the Tribunal decided to set aside the impugned order and remand the matter back to the CIT(A).

The Tribunal held that the CIT(E) had wrongly rejected the applications without adequately examining the nature and genuineness of the assessee's charitable activities and objects. It was observed that merely commencing activities is not a statutory ground for rejection, and the CIT(E) did not discharge its duty to examine the genuineness of activities. Therefore, both appeals were remanded back to the CIT(E) for a fresh examination of all aspects and to pass a new order.

The Tribunal condoned the delay in filing the appeal. It was observed that the assessment and appellate orders were ex-parte and not decided on merits. Therefore, the Tribunal set aside the CIT(A)'s order and remanded the matter back for fresh adjudication on merits, ensuring a proper opportunity for the assessee.

The Tribunal held that the CIT(E) had wrongly rejected the applications without adequately examining the nature and genuineness of the assessee's charitable activities and objects. It was observed that merely commencing activities is not a statutory ground for rejection, and the CIT(E) did not discharge its duty to examine the genuineness of activities. Therefore, both appeals were remanded back to the CIT(E) for a fresh examination of all aspects and to pass a new order.

The Tribunal accepted the assessee's business claim, noting that presumptive taxation under Section 44AD does not require elaborate records, and similar income was offered in previous years. However, acknowledging the unsubstantiated nature of the claims, especially the gift, a lump sum addition of Rs. 2.50 Lacs was confirmed, to be taxed at normal rates, not the higher rate under Section 115BBE, citing a Madras High Court decision. The Ld. AO was directed to re-compute the income accordingly.

The Tribunal ruled that once the assessee's trading activity and election for presumptive taxation under section 44AD are accepted, a portion of the turnover cannot be treated as cash credit under section 68, as books of account are not required. The addition of Rs. 15,35,900/- was deleted, and the AO was directed to re-calculate the taxable income by applying the profit rate under section 44AD on the gross turnover of Rs. 25,19,627/- shown in the return filed under section 148.

The Tribunal restored the issues of taxability of Rs.9,01,726/- agricultural income and the claim for Rs.1,46,630/- deduction under Section 80C back to the Assessing Officer. This was done to provide the assessee another opportunity to plead and substantiate these claims. The Tribunal noted that 50% of the interest on compensation had already been offered to tax.

The Tribunal observed that the CIT(A) passed ex-parte orders without evidence of notice service and failed to decide on merits. Upholding natural justice, the Tribunal set aside the CIT(A)'s orders and remanded the matter for fresh adjudication, directing the CIT(A) to provide the assessee a proper opportunity to present its case and decide on merits.

The Tribunal observed that the CIT(A) passed ex-parte orders without evidence of notice service and failed to decide on merits. Upholding natural justice, the Tribunal set aside the CIT(A)'s orders and remanded the matter for fresh adjudication, directing the CIT(A) to provide the assessee a proper opportunity to present its case and decide on merits.

The Tribunal observed that the CIT(A) passed ex-parte orders without evidence of notice service and failed to decide on merits. Upholding natural justice, the Tribunal set aside the CIT(A)'s orders and remanded the matter for fresh adjudication, directing the CIT(A) to provide the assessee a proper opportunity to present its case and decide on merits.

The Tribunal held that since substantive additions were confirmed in the hands of Shri Gurmail Singh and Shri Arshpreet Singh, the protective additions in the hands of the assessee could not be sustained. The principle of not taxing the same money twice was applied.