ITAT Chennai Judgments — March 2026

The Tribunal held that the service of notice through the ITBA portal by the CIT(A) was not a valid method as per Section 282(1) of the Income Tax Act, 1961. Consequently, the principles of natural justice were violated as the assessee was not afforded a proper opportunity to be heard.

The Tribunal held that the service of notice through the ITBA portal by the CIT(A) was not a valid method as per Section 282(1) of the Income Tax Act, 1961. Consequently, the principles of natural justice were violated as the assessee was not afforded a proper opportunity to be heard.

The Tribunal held that the appeal filed by the assessee was not maintainable before the Income Tax Appellate Tribunal. The reasoning was that the impugned order passed by the Assessing Officer – NFAC was not appealable before the ITAT and ought to have been challenged before the appropriate forum. Consequently, without going into the merits of the application for condonation of delay, the Tribunal dismissed the appeal as not maintainable. The operative direction was to dismiss the appeal.

The Tribunal noted that the assessee failed to appear before the AO and CIT(A), despite multiple opportunities. The Tribunal set aside the order of CIT(A) and remitted the matter back to the AO for a fresh assessment, providing the assessee an opportunity to be heard.

The Tribunal condoned the delay in filing appeals before the CIT(A) and set aside the CIT(A)'s order. The matter was remitted back to the AO for a fresh assessment after providing the assessee with a reasonable opportunity.

The Tribunal condoned the delay in filing appeals before the CIT(A) and set aside the CIT(A)'s order. The matter was remitted back to the AO for a fresh assessment after providing the assessee with a reasonable opportunity.

The Tribunal held that the assessee's explanation for the 851-day delay in filing the appeal was general and lacked specific details or material evidence, failing to establish a 'sufficient cause'.

The Tribunal observed that the incidence of melting loss cannot be ruled out but the onus is on the assessee to prove it. The Tribunal found that the CIT(A) erred in deleting the addition without properly examining the accounting treatment and industry standards, and also erred in holding that no disallowance can be made without rejecting the books of accounts.

The Tribunal held that the addition of Rs.8,04,450 related to cash deposits handled in connection with Business Correspondent (BC) activities and was not unexplained income, thus deleting this addition. Regarding the Rs.4,41,000 transferred from the spouse, the Tribunal found that while the source of the spouse's deposit wasn't fully substantiated, the banking trail was established, and therefore sustained 50% of the addition (Rs.2,20,500) and deleted the rest. The addition of Rs.41,746 for undisclosed interest income was confirmed.

The Tribunal noted that the assessee had already received relief by the condonation of delay in filing the applications. Therefore, the appeals were dismissed as withdrawn.

The Tribunal noted that the assessee had already received relief by the condonation of delay in filing the applications. Therefore, the appeals were dismissed as withdrawn.

The Tribunal noted that there was a delay in filing the appeals, which was condoned due to sufficient cause shown by the assessee. The assessee claimed ignorance of the CIT(A)'s notices due to not checking the income tax portal. The Tribunal found that the CIT(A) had provided opportunities for hearing but the assessee did not respond.

The Commissioner of Income Tax (Appeal) set aside the AO's assessment order and remitted the case back to the AO for fresh assessment. The Tribunal noted that the AO's order was based on available information and partial submissions, estimating income and rejecting books of accounts. The Tribunal found no infirmity in the CIT(A)'s order.

The Tribunal noted that no one appeared for the assessee. Both appeals were found to have a tax effect less than the monetary limit of Rs. 60 lakhs, as per CBDT Circular No. 09 of 2024. Therefore, the appeals were dismissed as not maintainable.

The Tribunal noted that there was a delay in filing the appeals, which was condoned due to sufficient cause shown by the assessee. The assessee claimed ignorance of the CIT(A)'s notices due to not checking the income tax portal. The Tribunal found that the CIT(A) had provided opportunities for hearing but the assessee did not respond.

The Tribunal held that the issue regarding the upward transfer pricing adjustment to manufacturing segment services required re-examination. The TPO was directed to examine additional evidence submitted by the assessee regarding the nature and rendering of services and decide if the transaction needed separate benchmarking. If so, a proper benchmarking exercise was to be conducted, giving the assessee a reasonable opportunity to be heard. The Tribunal also held that the professional charges paid were not a shareholder activity, as they provided a benefit an independent enterprise would pay for, and directed the TPO to consider this while re-examining the issue. The ground pertaining to interest on receivables was not pressed by the assessee. Regarding the incorrect total income, the Tribunal found merit in the assessee's submission that the AO had inadvertently included disallowances under Section 143(1) in the Section 143(3) assessment, despite his own finding that no adverse inference was called for. The AO was directed to re-compute the assessed income by deleting these disallowances. An additional ground regarding limitation was not admitted as it was not pressed.

The Tribunal condoned the delay in filing the appeal, noting the assessee's explanation that she became aware of the penalty order only upon receiving recovery notices during a visit to India. The matter was remanded to the CIT(A) to decide the appeal on merits.

The Tribunal found merit in the assessee's explanation, stating that the delay in uploading the report was procedural and technical glitches are a reasonable cause in the digital environment. The Tribunal noted that the audit report was filed before the assessment was completed, causing no prejudice to the revenue.

The Tribunal condoned the delay in filing the appeal due to the assessee's illness, noting that the Department did not controvert the affidavit. The Tribunal found that both the assessment order and the CIT(A)'s order were ex parte. Therefore, the matter was remanded to the Assessing Officer for a denovo assessment, allowing the appellant an opportunity of hearing.

The Tribunal held that the assessee had voluntarily surrendered the claim and made a full and true disclosure of all material facts at the time of filing the revised return, which was based on prevailing judicial pronouncements. Therefore, the penalty levied under Section 270A(8) r.w.s. 270A(9) was unwarranted.

The Tribunal held that Section 56(2)(vii)(b) is not applicable as there was no difference between the sale consideration and the stamp duty value, and the full consideration was paid via banking channels. The Tribunal further held that Section 69 is also not applicable as the investment was recorded and the consideration was explained through banking channels.

The Tribunal decided on the issues as follows: Regarding the write-back of liabilities (Revenue's Ground II & III), the Tribunal remitted the issue back to the TPO to examine if the write-back pertains to earlier year operating expenses. The TPO is directed to call for supporting evidence and allow the treatment if it relates to prior year operating expenses, providing the assessee an opportunity to be heard. Regarding capacity utilization adjustment (Revenue's Ground IV, V, VI & VII), the Tribunal noted the assessee's contention that depreciation as a percentage of sales was higher than comparables due to under-absorption of depreciation from under-utilization of capacity. While acknowledging that Rule 10B allows for adjustments materially affecting net profit margins, the Tribunal found the computation of adjustment based on the difference in depreciation as a percentage of sales to be not reasonably accurate. However, considering that the TPO had allowed cash PLI (excluding depreciation) in AY 2013-14, the Tribunal directed the TPO to re-compute the ALP considering the cash PLI of the assessee and comparables for the current year, with the assessee to submit relevant details. The Cross Objections of the assessee were dismissed as academic. The appeals of the assessee and the revenue were allowed for statistical purposes.

The Tribunal found that both the AO and CIT(A) had accepted that the assessee incurred expenses of Rs.21,35,094/- for maintenance and repair of his lorries, indicating he possessed lorries and earned income from them. The assessee had provided registration certificates for his owned lorry and leased lorries, along with confirmation letters from owners. While the Revenue pointed out that some confirmation letters were for FY 2009-10, the Tribunal noted that two leased lorries were the same as those leased in FY 2011-12, accepted by the AO in AY 2012-13, suggesting continuity of leasing from FY 2009-10 to FY 2011-12, including the relevant FY 2010-11. Therefore, the Tribunal deemed it appropriate to estimate the assessee's income by following the approach adopted by the AO in AY 2012-13. The Tribunal estimated turnover of Rs.16.00 to 16.20 lakhs per lorry, totaling Rs.64,80,000/- for 4 lorries, and assessed income at Rs.2,40,000/- under Section 44AE. For the remaining credits of Rs.8,23,119/-, income was estimated at 8% thereof, amounting to Rs.65,850/-. The CIT(A)'s order was set aside, and the AO was directed to assess income accordingly.

The Tribunal noted that no one appeared for the assessee. Both appeals were found to have a tax effect less than the monetary limit of Rs. 60 lakhs, as per CBDT Circular No. 09 of 2024. Therefore, the appeals were dismissed as not maintainable.

The Tribunal found the assessee's reason for delay to be genuine, considering the circumstances of remote location and lack of digital literacy. The Tribunal condoned the delay on the condition of a ₹20,000 payment to the State Legal Aid Authority.

The Tribunal found the assessee's reason for delay to be genuine, considering the circumstances of remote location and lack of digital literacy. The Tribunal condoned the delay on the condition of a ₹20,000 payment to the State Legal Aid Authority.

The Tribunal found the assessee's reason for delay to be genuine, considering the circumstances of remote location and lack of digital literacy. The Tribunal condoned the delay on the condition of a ₹20,000 payment to the State Legal Aid Authority.

The Tribunal held that a fresh return is not required if the assessee informs the AO to treat the earlier return as filed in response to the Section 148 notice. The Tribunal found that no notice under Section 143(2) was issued, rendering the reassessment invalid.

The Tribunal found the assessee's reason for delay to be genuine, considering the circumstances of remote location and lack of digital literacy. The Tribunal condoned the delay on the condition of a ₹20,000 payment to the State Legal Aid Authority.

The Tribunal found the assessee's reason for delay to be genuine, considering the circumstances of remote location and lack of digital literacy. The Tribunal condoned the delay on the condition of a ₹20,000 payment to the State Legal Aid Authority.

The Tribunal set aside the ex-parte order of the CIT(A) and remitted the matter back for fresh adjudication, directing the FAA to provide a reasonable opportunity of hearing to the assessee.

The Tribunal found the assessee's reason for delay to be genuine, considering the circumstances of remote location and lack of digital literacy. The Tribunal condoned the delay on the condition of a ₹20,000 payment to the State Legal Aid Authority.

The Tribunal held that payments to mutual fund distributors were not in the nature of technical services or royalty, and that the deletion of disallowance under Section 14A by the CIT(A) was justified. The delay in filing the appeals by the Revenue was condoned.

The Tribunal set aside the impugned order of the CIT(A) and remitted the matter back for fresh adjudication. The CIT(A) is directed to provide adequate opportunity to the assessee to file written submissions and documentary evidences and decide the issue in accordance with law. A legal ground challenging the validity of a notice under Section 143(2) for being unsigned was not pressed by the assessee.

The CIT(A) found that the assessee, a small businessman with limited education, was engaged in milk trading and had provided sufficient evidence to explain the nature and source of cash deposits and withdrawals from his business. The CIT(A) deleted the additions made by the AO.

The Tribunal condoned the delay in filing the appeal and admitted it for adjudication. While noting the assessee's non-participation, the Tribunal set aside the CIT(A)'s order and remitted the matter back to the AO for fresh adjudication after providing a reasonable opportunity to the assessee.

The Tribunal noted that the assessee was issued only one notice by the FAA and had responded to it, requesting more time. However, no further opportunity was granted. The Tribunal found it appropriate to remit the matter back to the FAA for a fresh examination.

The Tribunal dismissed the Revenue's appeal, affirming the CIT(A)'s decision. It held that the assessee had already offered the difference in stock valuation as business income in their return. The difference arose from adopting a GP ratio to the total valuation, and there was no finding of actual 'excess stock' by the Assessing Officer. Therefore, the addition under Section 69B was not justified.

The Tribunal held that the AO erred in making the addition under Section 68. The SBNs represented genuine sale receipts recorded in the books, supported by sales bills, stock records, and GST returns.

The Tribunal held that the order of the CIT(A) dismissing the appeal was not infirm, as the assessee was not entitled to the deduction for non-filing the return within the prescribed time. Consequently, the grounds raised by the assessee were dismissed.

The Tribunal found the assessee's reason for delay to be genuine, considering the circumstances of remote location and lack of digital literacy. The Tribunal condoned the delay on the condition of a ₹20,000 payment to the State Legal Aid Authority.

The Tribunal noted that the jurisdictional Assessing Officer (JAO) lacked the jurisdiction to issue the notice under Section 148, as this power vested with the Faceless Assessing Officer (FAO) as per relevant notifications. Citing High Court decisions, the Tribunal found the notice issued by the JAO to be ultra vires.

The Tribunal held that the assessee's explanation regarding the cash balance of ₹26,75,440/- as being from withdrawals was acceptable, explaining its source. However, the remaining ₹22,40,560/- was claimed as sales realization and recorded in the audited books, which were not rejected by the AO. Therefore, confirming the addition would be a double addition.

The Tribunal held that interest earned from investments in a cooperative bank is eligible for deduction under Section 80P(2)(a)(i) and 80P(2)(d) of the Income Tax Act, following the jurisdictional High Court's decisions. The AO's disallowance was therefore incorrect.

The Tribunal held that for the first two remittances of PF contribution, there was no infirmity in the CIT(A)'s order. However, for the third remittance falling on a Sunday, the assessee's payment on the next working day was considered sufficient compliance. For TDS, the matter was remanded for fresh adjudication due to evidence of deposit appearing on record.

The Tribunal held that payments to mutual fund distributors were not in the nature of technical services or royalty, and that the deletion of disallowance under Section 14A by the CIT(A) was justified. The delay in filing the appeals by the Revenue was condoned.

The Tribunal held that interest earned from investments in a cooperative bank is eligible for deduction under Section 80P(2)(a)(i) and 80P(2)(d) of the Income Tax Act, following the jurisdictional High Court's decisions. The AO's disallowance was therefore incorrect.

The Tribunal held that interest earned from investments in a cooperative bank is eligible for deduction under Section 80P(2)(a)(i) and 80P(2)(d) of the Income Tax Act, following the jurisdictional High Court's decisions. The AO's disallowance was therefore incorrect.

The Tribunal held that the delay in filing Form 68 was bonafide and should be condoned, following the precedent set by the Hon'ble High Court in Natarajan Anandh Kumar v. DCIT. The impugned order rejecting the application for immunity was quashed.

The Tribunal found the assessee's reason for delay to be genuine, considering the circumstances of remote location and lack of digital literacy. The Tribunal condoned the delay on the condition of a ₹20,000 payment to the State Legal Aid Authority.