ITAT Chennai Judgments — July 2025

The Tribunal found that the difference arose due to accounting treatment and that the total income returned was offered to tax. However, to verify the facts, the Tribunal decided to remit the issue back to the Assessing Officer.

The ITAT held that the assessee had shown sufficient cause for the delay in filing the appeal, which was due to the pendency and subsequent withdrawal of a writ petition to pursue the statutory appellate remedy. Consequently, the ITAT remitted the matter back to the CIT(A) with a direction to admit the appeal and decide it afresh on merits after providing a proper opportunity of being heard to the assessee.

The Tribunal held that the order passed by the CIT(E) rejecting the condonation application is not an appealable order before the Tribunal under Section 253 of the Act. Therefore, the grounds raised by the assessee were rejected.

The Tribunal found that the CIT(A) dismissed the appeal without considering the assessee's submissions, violating principles of natural justice. The matter was remitted back to the CIT(A) for a fresh decision.

The Tribunal noted that the assessee was not given a proper opportunity to be heard and was willing to furnish evidence. Therefore, the Tribunal allowed the appeal for statistical purposes, remitting the matter back to the CIT(A) for a fresh hearing.

The Tribunal held that the notice under Section 148 was issued by a non-jurisdictional officer and not in accordance with the mandatory faceless procedure prescribed by the CBDT notification. Consequently, the notice and the subsequent assessment order were set aside.

The Tribunal held that the penalty order was passed without considering the assessee's application for immunity under Section 270AA. Since the assessee was eligible for immunity and had a valid application pending, the penalty order was unjustified.

The Tribunal condoned the delay of 398 days in filing the appeal. Finding that the assessee claimed non-receipt of notices, the Tribunal, in the interest of justice, set aside the CIT(A)'s order and remanded the case for de novo adjudication, providing the assessee another opportunity to be heard.

The Tribunal held that the demand against the assessee for short deduction of TDS warrants deletion. The intention of PAN-Aadhaar linking provisions is to ensure compliance and not to unduly hardship payers, especially when the seller has offered income and the assessee was unaware of the inactive PAN status.

The Tribunal held that a statement recorded under Section 133A, without any corroborative material, cannot form the sole basis for an addition. The assessee was able to demonstrate that the expenditure for interior decoration was accounted for in earlier years. Therefore, the additions made by the AO were deleted.

The Tribunal held that the assessee failed to substantiate the cash deposits with credible documentary evidence, as confirmations were on plain paper without supporting documents. Given the unverifiable source of funds and the nature of the business, the Tribunal estimated 20% of the total cash deposits as additional income.

The Tribunal held that the assessee complied with the requirement for Section 80JJAA deduction as Form 10DA was filed within the extended due date. Regarding TDS credit, the Tribunal found merit in the assessee's submission concerning demerged entities and directed the AO to verify and allow the credit.

The Tribunal held that the CBDT Notification dated 29.03.2022, which mandated a faceless e-assessment scheme, was directly applicable. The notice under Section 148 was issued by the DCIT (JAO) and not by the FAO, which was contrary to the Scheme. Following various High Court judgments, including Hexaware Technologies Ltd., the Tribunal found that the issuance of notice by the JAO made it invalid.

The Tribunal noted that the assessee's Authorized Representative claimed technical glitches prevented timely submission of an agreement and ledger account explaining the cash deposits as commission receipts. In the interest of justice, the Tribunal granted one more opportunity.

The Tribunal condoned the delay of 146 days in filing the appeal before the CIT(A) due to medical reasons. On merits, the Tribunal found that the Assessing Officer was not justified in computing income under Section 44AD and directed recomputation under Section 44AE.

The Tribunal held that the assessee should be granted one more opportunity to present their case and submit necessary documents to the CIT(E). The matter was remitted back to the CIT(E) for fresh consideration of both the Section 12A and Section 80G applications.

The Tribunal held that the CIT(E) did not properly consider the documents submitted by the assessee, including the trust deed and supplementary deed. The Tribunal set aside the order of the CIT(E) and remanded the matter back for fresh consideration.

The Tribunal held that the filing of Form 10B is a procedural and directory requirement, not mandatory. Therefore, denial of exemption solely on the ground of delayed filing of the audit report, when substantive conditions were fulfilled, is not justified.

The Tribunal held that filing of the audit report in Form 10B is a procedural requirement, not mandatory. Since the substantive conditions for claiming exemption u/s.11 were fulfilled, the delay in filing Form 10B should not be a bar to granting the exemption.

The Tribunal held that the assessee was called exparte as they did not appear for the hearing. The CIT(A)'s decision to uphold the additions made by the AO was found to be justified due to the assessee's non-compliance and failure to provide proper documentation.

The Tribunal, citing principles of natural justice, condoned the delay in filing the appeal. It held that the assessee should be provided another opportunity to present their case before the CIT(A) for denovo adjudication.

The Tribunal held that the notice under Section 148 was issued by the ITO, Ward 2(4) [JAO] and not by the Faceless Assessment Officer (FAO), which is contrary to the e-assessment scheme. Relying on various High Court judgments, the Tribunal found that the mandatory faceless procedure was not followed.

The Tribunal affirmed the CIT(A)'s decision, ruling that the electronic filing of the audit report within the stipulated time under Section 139(1) is directory, not mandatory, for claiming exemption under Section 10(23C)(v). It held that contributions like offerings to a religious institution are not taxable income, and denying exemption on mere technical breaches, especially for a government-controlled entity, would be unfair. The Tribunal dismissed the Revenue's appeals and partly allowed the assessee's cross-objections, directing the AO to grant the exemption in its entirety.

The Tribunal held that the assessee should be given one more opportunity to present its case and submit evidence before the CIT(E). Therefore, both matters were remitted back to the CIT(E) for fresh consideration and adjudication.

The Tribunal held that the land sold was rural agricultural land and not a capital asset under Section 2(14)(iii) of the Income Tax Act. The Tribunal noted that the land was classified as 'Nanja' in revenue records, land revenue was paid, and paddy cultivation was certified.

The Tribunal held that the non-filing of the audit report electronically within the stipulated time cannot be considered mandatory, especially when the assessee is a religious institution whose receipts are primarily offerings and donations. The denial of exemption on technical grounds would defy fairness in taxation. The Tribunal further noted that the provisions regarding such prohibitions were not applicable to the assessment years in question.

The Tribunal set aside the order of the Ld. CIT(A) and restored the assessment to the file of the AO for a de novo assessment. The AO was directed to share any bank statement from 'Andhra Bank' with the assessee, and the assessee was directed to diligently file documents to prove the agricultural income source of the deposits.

The Tribunal held that the assessee had a bonafide belief that it did not have a PE in India, supported by interpretations of various court decisions. The admission of substantial questions of law by the High Court also indicated the debatable nature of the issue. The MAP resolution itself involved agreeing to disagree on the PE existence and was based on an estimated adjustment, not a conclusive finding of inaccurate particulars.

The Tribunal held that the assessee's Audit Report was filed within the extended due date granted by the CBDT. Therefore, the penalty levied for belated filing was not warranted and should be deleted.

The Tribunal allowed the assessee's request to withdraw the appeal, as the Ld.DR did not object. Consequently, the appeal filed by the assessee was dismissed as withdrawn.

The Tribunal held that the assessee had a bonafide belief that it did not have a PE in India, and the issue was debatable, especially since the High Court admitted it as a substantial question of law. The MAP resolution, being a settlement based on an assumption and not conclusive proof, did not automatically warrant a penalty. Therefore, the penalty levied was unjustified.

The tribunal noted that the Revenue did not object to the assessee's request. Consequently, the tribunal allowed the assessee to withdraw the appeal.

The Tribunal held that the updated valuation report, based on audited financials and prepared as per Rule 11UA, was admissible. The Tribunal found that the purchase price of the shares was not lower than the FMV determined as per Rule 11UA, and therefore, no addition under Section 56(2)(x) was warranted. The arguments regarding the treatment of negative values and liabilities were also decided in favor of the assessee.

The Tribunal held that any notice or order issued in the name of a non-existent entity that has merged or amalgamated is void ab initio. Since the notices u/s 148 and 143(2) and the reassessment order were issued in the name of the non-existent entity ALWL, despite the AO being aware of the amalgamation, the proceedings were considered null and void. Therefore, the reassessment order was quashed.

The Tribunal held that the issue of PE was debatable, as evidenced by the High Court admitting it as a substantial question of law and the MAP settlement where both parties agreed to disagree. The Tribunal found that the assessee acted on a bonafide belief and thus did not furnish inaccurate particulars. Therefore, the penalty was unjustified.

The Tribunal held that the assessee had not furnished inaccurate particulars of income. It was noted that the existence of the PE was a debatable issue, and the assessee acted under a bonafide belief. The MAP resolution, being a compromise based on an estimate, did not automatically imply inaccurate reporting, and therefore, the penalty was not sustainable.

The Tribunal held that the penalty levied under Section 270A is unsustainable if the basis for the addition, which led to the penalty, has been removed. Since the additions were deleted by the CIT(A) and not appealed by the revenue, the penalty could not sustain.

The Tribunal found that the existence of a PE in India was a debatable issue, as evidenced by the Hon'ble High Court admitting it as a substantial question of law and the MAP authorities agreeing to disagree on it. The MAP resolution, being an ad-hoc settlement, did not imply that the assessee furnished inaccurate particulars, especially since all material facts were disclosed and the assessee acted on a bona fide belief. Therefore, the Tribunal held that the levy of penalty was unjustified and deleted it.

The Tribunal held that the reopening of assessment beyond four years was bad in law as the Assessing Officer (AO) failed to satisfy the condition precedent under the first proviso to Section 147 of the Act. Specifically, the AO did not demonstrate that the escapement of income was due to the assessee's failure to disclose material facts.

The Tribunal held that the issue of PE was debatable, and the assessee had acted on a bonafide belief. The penalty was found to be unjustified as the assessee had not furnished inaccurate particulars of income, especially in light of the settlement through the Mutual Agreement Procedure (MAP) and the admission of substantial questions of law by the High Court.

The Income Tax Appellate Tribunal noted that the Revenue had no objection to the assessee's request to withdraw the appeal. Consequently, the Tribunal allowed the request and dismissed the appeal as withdrawn, in light of the assessee opting for the Vivad Se Vishwas Scheme, 2024.

The tribunal noted that the Department's Representative (DR) did not object to the assessee's request to withdraw the appeal. Consequently, the tribunal allowed the Trust to withdraw the appeal.

The Tribunal found a violation of natural justice and, considering the assessee's existing provisional registrations, granted one more opportunity. The impugned order was set aside, and the application was restored to the Ld.CIT(E) for fresh consideration.

The Income Tax Appellate Tribunal upheld the PCIT's order under Section 263. The Tribunal found that the Assessing Officer had failed to conduct proper enquiries into the allowability of the interest expenditure on borrowed funds invested in sister concerns, focusing only on the TDS aspect under Section 40(a)(ia). This lack of enquiry rendered the assessment order erroneous and prejudicial to the revenue, thus validating the PCIT's jurisdiction to revise the order.

The Tribunal noted that while the assessee had claimed a significant amount as agricultural income, the evidence provided was not fully substantiated. However, considering previous years' income and similar activities, the Tribunal restricted the exempt agricultural income to Rs. 51,10,422/-, bringing back Rs. 4,00,000/- as non-exempt income.

The Tribunal held that the CBDT Notification dated 29.03.2022, which mandates a faceless procedure for assessment and reassessment, was applicable. As the notice u/s 148 was not issued in a faceless manner, the entire proceedings were vitiated.