ITAT Chennai Judgments — February 2026

The tribunal held that a notice under Section 153C cannot be issued after April 1, 2021, even if the search was initiated prior to that date, based on the amendment to Section 153C(3). Consequently, the notices issued were deemed invalid.

The Tribunal held that notices issued under Section 153C after April 1, 2021, are invalid, even if the search was initiated prior to that date. This is based on the insertion of sub-section (3) to Section 153C. The appeals were allowed on this legal ground.

The Tribunal held that an order passed under Section 119(2)(b) of the Income Tax Act is not appealable before the Tribunal. Therefore, the appeal filed by the assessee is not maintainable.

The Tribunal found reasonable cause for the delay, considering the assessee's circumstances. It was deemed proper to afford another opportunity to the assessee.

The Tribunal held that the notice issued under Section 148 of the Act was invalid because it was issued beyond three years from the end of the relevant assessment year without obtaining approval from the Principal Chief Commissioner of Income Tax (PCCIT) as required by Section 151(ii). Consequently, the assessment order based on this invalid notice was quashed.

The CIT(A) dismissed the assessee's appeal without considering the relevant material, including cash receipts, payments, and cash book details. The Tribunal found these evidences necessary for fair adjudication and decided to remand the matter.

The Tribunal noted that the reasons for delay were similar for both appeals. Since the delay in the penalty appeal was condoned, and the reasons for delay in the quantum appeal were reasonable, the Tribunal directed the CIT(A) to condone the delay in the quantum appeal and decide the issue on merits. Similarly, the penalty appeal was also remanded to the CIT(A) for fresh consideration.

The Tribunal noted that the High Court of Madras, in a similar case, held that Section 234E was not retrospective and there was no mechanism to levy late fees before an amendment effective from 01.06.2015. Following this precedent, the Tribunal deleted the late fees levied for the relevant assessment years.

The Tribunal noted that the High Court of Madras, in a similar case, held that Section 234E was not retrospective and there was no mechanism to levy late fees before an amendment effective from 01.06.2015. Following this precedent, the Tribunal deleted the late fees levied for the relevant assessment years.

The Tribunal condoned the delay in filing the appeal. Considering the submissions from both parties and the need for further examination, the case was remanded to the Assessing Officer for a fresh decision.

The Tribunal noted that the reasons for delay were similar for both appeals. Since the delay in the penalty appeal was condoned, and the reasons for delay in the quantum appeal were reasonable, the Tribunal directed the CIT(A) to condone the delay in the quantum appeal and decide the issue on merits. Similarly, the penalty appeal was also remanded to the CIT(A) for fresh consideration.

The Tribunal held that the death of the auditor, occurring six months before the intimation order, did not constitute a sufficient cause for the inordinate delay in filing the appeal. The assessee failed to demonstrate steps taken to manage its affairs or find an alternative auditor.

The Tribunal noted that the assessee had voluntarily admitted additional income. The CIT(A) had directed the Assessing Officer to determine the correct peak cash credit for assessment years 2009-10 to 2019-20 and to add the remaining amount of admitted income. The Tribunal found no infirmity in this direction.

The Tribunal noted that the assessee had voluntarily admitted additional income. The CIT(A) had directed the Assessing Officer to determine the correct peak cash credit for assessment years 2009-10 to 2019-20 and to add the remaining amount of admitted income. The Tribunal found no infirmity in this direction.

The Tribunal noted that the High Court of Madras, in a similar case, held that Section 234E was not retrospective and there was no mechanism to levy late fees before an amendment effective from 01.06.2015. Following this precedent, the Tribunal deleted the late fees levied for the relevant assessment years.

The Tribunal noted that the High Court of Madras, in a similar case, held that Section 234E was not retrospective and there was no mechanism to levy late fees before an amendment effective from 01.06.2015. Following this precedent, the Tribunal deleted the late fees levied for the relevant assessment years.

The Tribunal held that the death of the auditor, occurring six months before the intimation order, did not constitute a sufficient cause for the inordinate delay in filing the appeal. The assessee failed to demonstrate steps taken to manage its affairs or find an alternative auditor.

The Tribunal held that the subsequent rectification deed, along with other contemporaneous evidence showing the trust's control and beneficial enjoyment of the property, demonstrated no violation of Section 13(1)(c). The trustees did not derive any personal benefit from the properties.

The Tribunal upheld the addition of Rs. 10,84,977/- as unexplained money. The claims for agricultural income and cash gifts were not substantiated with credible evidence, particularly regarding the assessee's share in land, the source of funds for gifts, and the physical movement of cash.

The Tribunal held that the AO erred in re-evaluating the Discounted Cash Flow (DCF) projections made by the assessee. The AO cannot substitute his own assumptions for the valuer's projections, especially when the valuation method itself is not defective. Therefore, the addition under Section 56(2)(viib) was deleted.

The Tribunal held that the CIT(Exemptions) exceeded their jurisdiction by conducting a detailed examination of receipts and expenditure patterns at the registration stage. The Tribunal found that the assessee's activities constituted systematic training in sports, falling under 'education' as per Section 2(15), and the genuineness of activities was evidenced by records.

The Tribunal held that while the Assessing Officer had conducted inquiries during assessment, making the revision order solely on grounds of 'lack of enquiry' incorrect, the assessment order was indeed erroneous and prejudicial to revenue because the deduction for bad debts was not properly restricted by adjusting the previous year's allowance as mandated by law.

The Tribunal condoned the delay in filing the appeal, recognizing sufficient cause. It was noted that the First Appellate Authority's orders were ex-parte due to non-compliance with notices, and assessments were made on a best judgment basis. The Tribunal decided to restore the matters to the AO for fresh adjudication.

The Tribunal condoned the delay in filing the appeal, recognizing sufficient cause. It was noted that the First Appellate Authority's orders were ex-parte due to non-compliance with notices, and assessments were made on a best judgment basis. The Tribunal decided to restore the matters to the AO for fresh adjudication.

The Tribunal held that the penalty notice issued under Section 274 read with Section 271AAB was defective as it did not specify the clause under which penalty was being initiated. Therefore, the consequent penalty order was unsustainable.

The assessee filed Form 67 after the intimation under Section 143(1) was issued, which is beyond the due date of filing the return and much after the intimation order. Following the jurisdictional High Court's judgment, the claim of FTC is not allowable as Form 67 was filed late.

The Tribunal noted that the FAA's order was ex-parte due to the assessee's failure to respond to notices. While deprecating the assessee's attitude, the Tribunal decided to restore the matter to the FAA for a fresh adjudication in the interest of justice and fair play, granting one last opportunity.

The Tribunal found that the delay in filing the appeals before the CIT(A) was due to the absence of an accountant and was not deliberate. The Tribunal condoned the delay, set aside the orders of the CIT(A), and restored the appeals for adjudication on merits.

The Tribunal found that the delay in filing the appeals before the CIT(A) was due to the absence of an accountant and was not deliberate. The Tribunal condoned the delay, set aside the orders of the CIT(A), and restored the appeals for adjudication on merits.

The Tribunal held that the reason for the delay in filing appeals was bonafide and there was a reasonable cause. The assessee's mother-in-law, residing in Chennai, could not communicate the notices due to old age and lack of familiarity with tax matters. The Tribunal condoned the delay.

The Tribunal held that the reason for the delay in filing appeals was bonafide and there was a reasonable cause. The assessee's mother-in-law, residing in Chennai, could not communicate the notices due to old age and lack of familiarity with tax matters. The Tribunal condoned the delay.

The Tribunal held that the reason for the delay in filing appeals was bonafide and there was a reasonable cause. The assessee's mother-in-law, residing in Chennai, could not communicate the notices due to old age and lack of familiarity with tax matters. The Tribunal condoned the delay.

The Tribunal observed that the assessee neither appeared nor filed submissions before the CIT(A) due to issues with their email ID. The Tribunal, in the interest of justice, decided to grant the assessee a final opportunity to present their case before the CIT(A) by setting aside the impugned order.

The Tribunal noted that the CIT(A) had quashed the Assessing Officer's order based on High Court judgments. Furthermore, retrospective amendments introduced by Budget 2026 addressed jurisdictional issues concerning the Assessing Officer and Faceless Assessing Officer. The Tribunal decided to set aside the CIT(A)'s order and restore the matter to await outcomes of Supreme Court and High Court decisions on these amendments.

The Tribunal considered the rival submissions and perused the orders of the CIT(A) and AO. In the interest of justice, the Tribunal decided to grant the assessee a final opportunity to present evidence and submissions before the CIT(A).

The Tribunal condoned the delay, admitting the appeal. It noted that the assessee provided evidence, including a VAO certificate, confirming the land was agricultural and beyond 8 km from municipal limits. The stamp duty paid was as per the guideline value for agricultural land, and the Assessing Officer's reopening of the assessment lacked new or tangible information.

The Tribunal found that the appellate authority has no jurisdiction to dismiss an appeal for non-compliance without considering the merits. The FAA is bound to decide the appeal on its merits even if the assessee is absent.

The Tribunal noted that the Assessing Officer made an addition on account of unexplained cash credit. The assessee had submitted that the cash credit represented genuine transactions and had furnished supporting documents. However, the Tribunal found that the Assessing Officer had not properly examined the evidence submitted by the assessee. The Tribunal observed that the Assessing Officer's order was based on a perfunctory examination of the facts and evidence. Therefore, the Tribunal set aside the order of the Assessing Officer and remanded the issue back to the Assessing Officer for fresh adjudication. The Assessing Officer was directed to consider all the evidence submitted by the assessee and pass a speaking order. The Tribunal did not decide on the merits of the cash credit itself, leaving it for the Assessing Officer to determine.

The Tribunal condoned the delay and admitted the appeal for adjudication. It noted that a new clause (iv) was inserted into the first proviso of Section 80G(5) by the Finance Act, 2024, allowing applications at any time after commencement of activities. The CIT(E)'s rejection was after this amendment came into force.

The Tribunal noted that the proceedings before the AO and FAA were ex-parte due to the assessee's non-compliance with notices. While deprecating the assessee's attitude, the Tribunal restored the matter to the AO for fresh adjudication with a condition of paying Rs. 10,000/- as costs.

The Tribunal upheld the decision of the CIT(A) to treat the bank credits as business turnover and estimate profit at 8%. The addition under Section 69A was modified and restricted to the estimated income.

The Tribunal found that the FAA erred in dismissing the appeal without proper adjudication and by incorrectly referencing a penalty order. The FAA's decision was based on a misapplication of facts and law.

The Tribunal noted that the assessee was under judicial custody during the assessment and appellate proceedings, leading to non-appearance. The assessee has now provided documents to substantiate the source of investment in an immovable property. The Tribunal felt it was in the interest of justice to restore the matter to the AO for fresh adjudication.

The Tribunal admitted the additional evidence filed by the assessee, finding it necessary for substantial justice and going to the root of the matter. The Tribunal noted that the assessee could not file documentary evidence during assessment proceedings due to the Covid-19 pandemic. Consequently, the Tribunal set aside the impugned orders concerning the issue of agricultural income and restored them to the file of the Assessing Officer (AO) for a fresh hearing on merits. The AO was directed to afford a proper opportunity of hearing to the assessee and to pass fresh assessments in accordance with the law after the assessee substantiates its case with all relevant material and documents. A cost of Rs. 5,000/- per case was imposed on the assessee, to be deposited with the Tamil Nadu State Legal Services Authority. Regarding the issue relating to Section 45(2), the Tribunal held that no interference was required with the CIT(A)'s order. The appeals were allowed for statistical purposes.

The Tribunal held that since the quantum addition was deleted in the assessee's appeal, the consequential penalty levied under Section 271AAC cannot survive. The penalty was directed to be deleted based on the principle that if the foundation is removed, the superstructure falls.

The Tribunal held that the Uttarakhand unit was engaged in manufacture and constituted an expansion, not a split-up, of the existing business. Substantial value addition occurred at the unit, and inter-unit transfers were at arm's length.

The Tribunal admitted the additional evidence filed by the assessee, finding it necessary for substantial justice and going to the root of the matter. The Tribunal noted that the assessee could not file documentary evidence during assessment proceedings due to the Covid-19 pandemic. Consequently, the Tribunal set aside the impugned orders concerning the issue of agricultural income and restored them to the file of the Assessing Officer (AO) for a fresh hearing on merits. The AO was directed to afford a proper opportunity of hearing to the assessee and to pass fresh assessments in accordance with the law after the assessee substantiates its case with all relevant material and documents. A cost of Rs. 5,000/- per case was imposed on the assessee, to be deposited with the Tamil Nadu State Legal Services Authority. Regarding the issue relating to Section 45(2), the Tribunal held that no interference was required with the CIT(A)'s order. The appeals were allowed for statistical purposes.

The Tribunal condoned the delay in filing the appeal before the FAA, finding the assessee's reason for unawareness of the order to be reasonable. The Tribunal set aside the FAA's order and remitted the matter back to the AO for fresh adjudication, directing the AO to provide the assessee with a reasonable opportunity of hearing.

The Tribunal held that the Uttarakhand unit was engaged in manufacture and constituted an expansion, not a split-up, of the existing business. Substantial value addition occurred at the unit, and inter-unit transfers were at arm's length.

The Tribunal noted that since the quantum assessment order was set aside by a separate order, the penalty order arising from it cannot be independently sustained. Consequently, the delay in filing the appeal before the FAA is condoned.