ITAT Chennai Judgments — January 2026

The Tribunal held that only the profit element embedded in unaccounted purchases can be taxed, not the entire purchase value, especially when sales are not doubted. It also ruled that taxing the same transactions as both unaccounted purchases (business income) and unexplained expenditure (u/s 69C) amounts to double taxation and is impermissible.

The Tribunal estimated the profit at 5% for certain projects, considering the complexities and to bring an end to the litigation. Additions made for unexplained investment were directed to be deleted.

The Tribunal condoned delays in filing appeals and cross-objections. It ruled that depreciation on goodwill arising from amalgamation is admissible, even if not recorded in the books, and upheld transfer pricing adjustments concerning business support services, aligning with the principle of consistency. The disallowance under Section 14A was deemed permissible only up to the amount of exempt income.

The CIT(A) allowed deduction for bad debts, granted relief under Section 14A, restricted additions for shell entities, deleted addition for unexplained investment, and deleted addition for unexplained loan repayment. The Tribunal found flaws in the CIT(A)'s order, particularly regarding the admission of additional evidence without opportunity to the AO.

The provided text is an excerpt from the cause list or header of an Income Tax Appellate Tribunal order. It lists the parties, assessment years, and dates of hearing/pronouncement. It does not contain any substantive analysis, findings, reasoning, ratio decidendi, or operative directions from the Tribunal. Therefore, what the Tribunal decided, the reasoning, the ratio, and any operative directions are not recorded in this excerpt. No issue was expressly left undecided as no decision has been presented.

The Tribunal held that the requirement of filing Form No.10IE is directory and not mandatory. Once the form is available before processing, the benefit of the new tax regime should be extended. The same option is valid for subsequent assessment years.

The Tribunal estimated the profit at 5% for certain projects, considering the complexities and to bring an end to the litigation. Additions made for unexplained investment were directed to be deleted.

The Tribunal estimated the profit at 5% for certain projects, considering the complexities and to bring an end to the litigation. Additions made for unexplained investment were directed to be deleted.

The Tribunal estimated the profit at 5% for certain projects, considering the complexities and to bring an end to the litigation. Additions made for unexplained investment were directed to be deleted.

The Tribunal estimated the profit at 5% for certain projects, considering the complexities and to bring an end to the litigation. Additions made for unexplained investment were directed to be deleted.

The Tribunal estimated the profit at 5% for certain projects, considering the complexities and to bring an end to the litigation. Additions made for unexplained investment were directed to be deleted.

The Tribunal estimated the profit at 5% for certain projects, considering the complexities and to bring an end to the litigation. Additions made for unexplained investment were directed to be deleted.

The Tribunal held that the profit estimation by the Assessing Officer was arbitrary and directed a revised estimation of profit at 5% on turnover for certain projects. Additions on account of unexplained investment were also directed to be deleted.

The Tribunal estimated the profit at 5% for certain projects, considering the complexities and to bring an end to the litigation. Additions made for unexplained investment were directed to be deleted.

The Tribunal estimated the profit at 5% for certain projects, considering the complexities and to bring an end to the litigation. Additions made for unexplained investment were directed to be deleted.

The Tribunal held that only the profit element embedded in unaccounted purchases can be taxed, not the entire purchase value, especially when sales are not doubted. It also ruled that taxing the same transactions as both unaccounted purchases (business income) and unexplained expenditure (u/s 69C) amounts to double taxation and is impermissible.

The Tribunal held that the notice for reassessment under section 148 was not maintainable because a revised return was pending and the notice was issued beyond the permissible time limit for issuing a notice under section 143(2). Consequently, the reassessment order was quashed.

The CIT(A) allowed deduction for bad debts, granted relief under Section 14A, restricted additions for shell entities, deleted addition for unexplained investment, and deleted addition for unexplained loan repayment. The Tribunal found flaws in the CIT(A)'s order, particularly regarding the admission of additional evidence without opportunity to the AO.

The Tribunal allowed the assessee's grounds concerning the validity of reassessment proceedings for AY 2014-15 and AY 2017-18. For AY 2014-15, the Tribunal found that the notice under section 148 was issued beyond the period of limitation prescribed by the first proviso to section 147, as the original assessment was completed on 03.12.2016 and the notice was issued on 31.03.2021. The Tribunal also noted that the Assessing Officer failed to provide the actual reasons recorded for reopening, which is a procedural lapse. Furthermore, the Tribunal held that the reassessment was based on a 'change of opinion' and quashed the reassessment order. For AY 2017-18, the Tribunal held that the issuance of a notice under section 148 was not maintainable because the assessment proceedings were still pending before the Assessing Officer, following the decisions in Trustees of H.E.N. the Nizam’s Supplemental Family Trust v. CIT and K.M. Pachayappan. The reassessment order for AY 2017-18 was consequently quashed. For AY 2018-19, the Tribunal, finding the facts and circumstances identical to AY 2015-16, held that the assessee was entitled to claim exemption under section 11 of the Act, setting aside the CIT(A)'s order and deleting the addition. No finding was given on the merits for AY 2017-18 due to the quashing of the reassessment order on legal grounds.

The assessee's authorized representative requested to withdraw the appeal as it was a duplicate filing. The tribunal considered the request and the petition for withdrawal.

The Tribunal upheld the CIT(A)'s decision, holding that the addition was not sustainable. The seized material was from a third party, lacked necessary particulars, and was not corroborated. Additionally, proceedings under section 153A for AY 2013-14 were found to be without jurisdiction as the conditions for extended assessment period were not met.

The Tribunal held that the Assessing Officer lacked jurisdiction to issue notices under Section 153C for extended assessment years without establishing the existence of undisclosed assets of Rs. 50 lakhs or more, as required by the fourth proviso to Section 153A.

The Tribunal noted that the AO and CIT(A) did not properly consider the details submitted by the assessee. The Tribunal also observed that the DGFT norms cited by the CIT(A) were not applicable to the case, which involved wastage/loss from converting beaten gold to pure gold, not manufacturing from pure gold. Therefore, the issue needed detailed verification by the assessing authority.

The Tribunal held that loose sheets and notepads seized from a third party, not in the assessee's handwriting and not part of regular books of account, lack evidentiary value without corroborative evidence. The initial statement of the third party was also retracted.

The CIT(A) deleted the addition, finding the seized documents defective and the supporting statement unreliable. The Tribunal upheld the deletion, agreeing that the addition was not legally sustainable based on the evidence presented.

The Tribunal noted that the ex-parte order was passed because the assessee failed to respond to notices from the FAA. Despite deprecating the assessee's attitude, the Tribunal, in the interest of justice, decided to restore the matter to the FAA for a fresh adjudication, offering a last opportunity for proper representation.

The Tribunal held that seized material from a third party's premises, not in the assessee's handwriting and lacking corroborative evidence, cannot be used to make an addition. The assessee's explanation for the source of funds was also not adequately disproven.

The Tribunal held that the notice under Section 148 was not issued in accordance with the mandatory e-assessment scheme, making it void ab initio. Following jurisdictional High Court precedents, the Tribunal set aside the notice and consequential orders.

The Tribunal held that the notice under Section 148 was issued contrary to the mandatory faceless procedure prescribed by the CBDT's e-assessment scheme. Following the jurisdictional High Court's decision, the notice and consequential orders were set aside.

The Tribunal held that the notice issued by the JAO was not in accordance with the e-assessment scheme and was therefore void ab initio. Following the jurisdictional High Court's decision, the Tribunal set aside the notice and consequential orders.

The Tribunal held that the addition was unsustainable as the seized documents lacked evidentiary value and did not establish any nexus with the assessee. The Tribunal followed its prior decision in the purchaser's case where similar allegations were disbelieved.

The Tribunal held that corpus donations cannot be treated as income, especially when utilized for charitable objects as per donor directions and trust deed. The disallowance of administrative expenses was found to be ad-hoc and not based on concrete material.

The Tribunal condoned the delay in filing the appeals, recognizing sufficient cause due to the circumstances explained. The proceedings before the lower authorities were ex-parte due to non-compliance with notices, stemming from the chartered accountant's illness and inability to represent the assessee.

The Tribunal noted that the AO and CIT(A) did not properly consider the details submitted by the assessee. The Tribunal also observed that the DGFT norms cited by the CIT(A) were not applicable to the case, which involved wastage/loss from converting beaten gold to pure gold, not manufacturing from pure gold. Therefore, the issue needed detailed verification by the assessing authority.

The Tribunal condoned the delay of 160 days, finding sufficient cause for the belated filing. The Tribunal directed the CIT(E) to consider the application submitted on 28.09.2024 as filed under the newly amended clause (iv)(B) of the first proviso to Section 80G(5) of the Act.

The Tribunal held that the disallowance of deduction for interest and dividend income was based on a bona fide claim. Citing High Court judgments, the Tribunal found that the exception under section 270A(6)(a) was applicable, and therefore, no penalty could be levied.

The Tribunal held that a claim for deduction under Section 80P can only be allowed if it is made in a valid return filed within the prescribed due dates. The return filed in response to a notice under Section 148, or belatedly under Section 139(4) or 142(1), is considered non-est for claiming such deductions if not filed within the due dates specified in Section 139(1).

The Tribunal condoned the delay in filing the appeals, recognizing sufficient cause due to the circumstances explained. The proceedings before the lower authorities were ex-parte due to non-compliance with notices, stemming from the chartered accountant's illness and inability to represent the assessee.

The CIT(A) held that the adjustment made under section 143(1) was beyond jurisdiction, deleted the disallowance, and quashed the demand. The Tribunal upheld the CIT(A)'s order, finding that the disallowance was not a mere arithmetical error but involved substantive examination of the assessee's claim, which is not permissible in summary proceedings.

The Tribunal held that the legal grounds raised by the assessee regarding jurisdiction under Section 153A were dismissed as the assessment years involved were abated. Regarding the merits, the Tribunal allowed the benefit of unutilized telescoping to delete the additions related to unsecured creditors and agricultural income for the relevant assessment years.

The Tribunal partly allowed the assessee's appeals and dismissed the revenue's appeals. It upheld the deletion of certain additions based on telescoping benefits and the nature of agricultural income, while confirming other additions to the extent of incremental balances.

The Tribunal held that the legal grounds raised by the assessee regarding jurisdiction under Section 153A were dismissed as the assessment years involved were abated. Regarding the merits, the Tribunal allowed the benefit of unutilized telescoping to delete the additions related to unsecured creditors and agricultural income for the relevant assessment years.

The Tribunal held that the interest income earned by the cooperative society from investments in a cooperative bank is eligible for deduction under Section 80P(2)(d) of the Income Tax Act. This is based on the interpretation of the law and various High Court judgments, which have settled this issue.

The Tribunal partly allowed the assessee's appeals and dismissed the revenue's appeals. It upheld the deletion of certain additions based on telescoping benefits and the nature of agricultural income, while confirming other additions to the extent of incremental balances.

The Tribunal partly allowed the assessee's appeals and dismissed the revenue's appeals. It upheld the deletion of certain additions based on telescoping benefits and the nature of agricultural income, while confirming other additions to the extent of incremental balances.

The Tribunal upheld the order of the Ld. CIT(A) on all grounds. Regarding the amortization of goodwill, the Tribunal followed its own decision in the Assessee's own case (IT(TP)A No.17/Chny/2024) and directed the AO/TPO to treat amortization of goodwill as a non-operating expense. The reasoning was that goodwill arising from a business acquisition is an abnormal item and not part of operating expenditure. For the exclusion of comparable companies, the Tribunal relied on its previous decisions. M/s. Nihilent Limited was excluded due to diversified services and unavailability of segmental results. M/s. Cybage Software Private Ltd. was excluded due to functional dissimilarity, proprietary software, significant scale of operation, and lack of segmental information. M/s. Daffodil Software Private Ltd. was excluded because it was engaged in software products, not IT services, and lacked segmented details. The Revenue's grounds of appeal were dismissed. The Assessee's cross-objection became academic and was dismissed.

The Tribunal held that the legal grounds raised by the assessee regarding jurisdiction under Section 153A were dismissed as the assessment years involved were abated. Regarding the merits, the Tribunal allowed the benefit of unutilized telescoping to delete the additions related to unsecured creditors and agricultural income for the relevant assessment years.

The Tribunal held that the cash deposits primarily represented fees and service-related collections, not donations. Even for voluntary donations, donor details were provided for most amounts, leaving only a small sum unverifiable. The Tribunal found no incriminating material to support the AO's addition.

The Tribunal held that the prize money of Rs.1,68,50,073/- received by the assessee from the online gaming platform is liable to tax under Section 115BB of the Act for AY 2022-23. The Tribunal reasoned that Section 115BB, as applicable for AY 2022-23, taxes winnings from card games and other games of any sort at a flat rate of 30% without allowing any deduction or set-off for expenditure or losses. The contention that online rummy is a game of skill does not exempt it from Section 115BB, as the expression "other games of any sort" is of wide amplitude and the provision does not distinguish between games of skill and chance, as held in CIT v. G.R. Karthikeyan. The Tribunal further held that the legislative changes introduced by the Finance Act, 2023, including the taxation of "net winnings" and the proviso to Section 115BB, are expressly made applicable from AY 2024-25 onwards and cannot be applied retrospectively. The reliance on CIT v. Alom Extrusions Ltd. was deemed misplaced as the amendments constitute a substantive change. The Tribunal found no infirmity in the orders of the Assessing Officer and CIT(A). The appeal filed by the assessee was dismissed.

The Tribunal held that the AMP expenses incurred by the assessee were primarily for its own marketing and sales, not to actively promote the Associated Enterprise's (AE's) brand. Thus, the primary beneficiary was the assessee, and any incidental benefit to the AE did not warrant a disallowance. The 'Bright Line Test' cannot be used to independently determine an international transaction for transfer pricing purposes.