ITAT Delhi Judgments — June 2025

The Tribunal held that the notice under section 153C of the Act was issued beyond the prescribed period of 6 years from the date of search, as determined by the Supreme Court in CIT vs Jasjit Singh. Therefore, the assumption of jurisdiction by the AO was improper and the assessments were quashed.

The Tribunal upheld the decision of the CIT(A), finding that the assessee had demonstrated the source of the cash deposits from explained sources like sales proceeds. The nature of the business and historical data supported the explanation.

The Tribunal held that for Assessment Year 2008-09, the notice under Section 153C was issued beyond the prescribed period, making the assessment beyond jurisdiction and quashed it. For other years, no incriminating material was found during the search, and since the assessments were unabated, the additions/disallowances were deleted.

The Tribunal condoned the delay in filing the appeal, finding sufficient and reasonable cause. The Tribunal set aside the CIT(A)'s order and remitted the issue back to the AO for a de novo assessment.

The Tribunal held that the cash deposits were proved to be out of regular cash balance from sales, and the unsecured loans met the three ingredients of Section 68, with the transaction not materializing leading to repayment. Therefore, the additions made by the AO were deleted.

The tribunal held that the assessees were accommodation entry providers. While agreeing that the entire disallowance was not sustainable, it found merit in the CIT(A)'s principle of assessing a profit element. However, the tribunal reduced the profit element to 1% from 2.5%, stating it would not be a precedent.

The Tribunal held that the date of search qua the assessee becomes 18.09.2014 based on the Supreme Court decision in CIT vs Jasjit Singh. Since AY 2008-09 falls beyond the 6-year period from the search date, the assessment framed under section 153C is beyond jurisdiction and quashed. Similar issues for other AYs were also decided on the same grounds.

The Tribunal held that for material found during a search of a third party that pertains to the assessee, proceedings must be initiated under Section 153C of the Income Tax Act. Framing assessments under Section 153A without following the mandatory procedure under Section 153C renders the assessment invalid.

The Tribunal observed that the assessee did not fully participate in the assessment and appellate proceedings, and requested video conferencing which was denied. Considering the facts and the issue of short TDS deduction, the Tribunal decided to give the assessee one more opportunity.

The Tribunal noted that the quantum appeal of the assessee, ITA No. 308/Del/2025, was still pending and yet to attain finality. Considering this factual position, the Tribunal restored the penalty appeal back to the Assessing Officer to await the final outcome of the quantum appeal.

The Tribunal held that the additions made by the Assessing Officer in their entirety were not sustainable. It found merit in the CIT(A)'s approach of restricting the additions to the estimated profit element. However, the profit element was further reduced to 1% on a case-to-case basis, without treating it as a precedent.

The Tribunal held that the AO failed to conduct independent investigation and relied solely on information from the Investigation Wing. The AO also did not demonstrate that the assessee was engaged in the alleged fictitious profit-making activities. Therefore, the addition made by the AO was not sustainable and the order of the CIT(A) deleting the additions was upheld.

The Tribunal held that Section 68 of the Income Tax Act is applicable only when sums are found credited in the books of the assessee. Since the cash deposits were in the books of other companies and not the assessee's books, Section 68 was not applicable. The Tribunal relied on various judicial precedents to support this view.

The Income Tax Appellate Tribunal set aside the order of the CIT(E) and remanded the matter back for fresh consideration. The CIT(E) was directed to afford the assessee a reasonable opportunity to furnish all necessary details and evidence for registration under Sections 12A and 80G.

The Tribunal held that the CIT(A) erred in dismissing the appeals without affording adequate opportunity of hearing to the assessee. Therefore, the orders of the CIT(A) and AO were set aside.

The Tribunal held that the CIT(A) had erred in dismissing the appeals without providing adequate opportunity of hearing to the assessee. Therefore, the orders of the CIT(A) and AO were set aside and the matter was restored to the AO for fresh decision.

The Tribunal noted that the reopening was based on a mechanical approval from the prescribed authority under section 151, which was not rebutted by the department. Citing a precedent, the Tribunal quashed the assessment.

The Tribunal noted that the assessee did not wish to pursue the appeal and, with no objection from the department, the appeal was dismissed as withdrawn.

The Tribunal held that since the order under Section 263, which formed the basis of the proceedings, was quashed by a coordinate bench of ITAT and confirmed by the High Court, there was no reason to interfere with the CIT(A)'s order.

The Tribunal remitted the issue back to the CIT(A) to decide on merit after allowing proper opportunity for the assessee to present documentary evidence and comply with notices.

The Tribunal held that the assessees were indeed accommodation entry providers. The addition should be restricted to the estimated profit element, not the entire turnover. The CIT(A)'s estimation of 2.5% was found reasonable, but the profit element was further restricted to 1% without treating it as a precedent.

The Tribunal held that the approval granted under Section 153D of the Act was mechanical and without due application of mind, as it was granted in a single letter for multiple assessment years and on the same day. Such an approval vitiates the assessment order.

The Tribunal held that the final assessment order was passed beyond the time limit prescribed under Section 144C(13) of the Act. The date of uploading the DRP order on the ITBA portal was determined as 31.05.2024, and the assessment ought to have been completed by 31.05.2022. Therefore, the assessment order was set aside as being barred by limitation.

The Tribunal held that the Assessing Officer exceeded his jurisdiction in making additions on issues not forming part of the reasons recorded for reopening the assessment. For AY 2018-19, it was held that the expenses disallowed were for day-to-day business activities and did not relate to earning exempt income, hence the disallowance was deleted.

The Tribunal held that the CIT(E)'s order rejecting the application for registration was not justified and that the matter should be remanded back for consideration of documents. The assessee's appeals were allowed for statistical purposes.

The Tribunal held that the objects of the trust deed were indeed charitable in nature. The assessee's activities, including skill training and partnerships, were found to be charitable. The denial of registration by the CIT(E) was therefore unjustified.

The Tribunal condoned the delay, holding that the reasons provided by the assessee constituted a sufficient and reasonable cause for the non-appearance. The appeal was restored to the CIT(A) for fresh adjudication on merits.

The Tribunal acknowledged the possibility of communication gaps due to the faceless hearing system and decided to restore the appeal to the CIT(A)/NFAC for fresh adjudication.

The Tribunal set aside the order of the CIT(E) and remitted the issue back to the CIT(E) for fresh decision after affording a reasonable opportunity to the assessee to produce all details and evidence.

The Tribunal observed that the AO/CIT(A) made sweeping allegations without substantiating them with material evidence. The Tribunal found that the control and management of the Assessee's affairs were situated in Mauritius, not India. The Tribunal also noted that the amendment to Article 13 of the India-Mauritius DTAA regarding capital gains on shares acquired before April 1, 2017, was grandfathered, making it non-taxable in India.

The Tribunal held that the CIT(A) had correctly analyzed the facts and admitted additional evidence. The Tribunal found that the cash deposits were from explained sources, primarily sale proceeds, and there was a regular pattern of such deposits in earlier and subsequent years. The business model involved significant cash sales and collections from vendors/customers.