ITAT Delhi Judgments — July 2025

The Tribunal held that the assessment orders were barred by limitation. The primary issue revolved around the validity of the extension of the limitation period under Explanation (ix) to Section 153B of the Act, which allows for exclusion of time taken for exchange of information under an agreement referred to in Section 90 or Section 90A. The Tribunal noted that the Double Taxation Avoidance Agreement (DTAA) between India and Hong Kong came into force on November 30, 2018. According to Paragraph 5(c) of Article 26 of the DTAA, requests for information for periods prior to November 30, 2018, must be relevant to a fiscal year or taxable event occurring after that date. The reference made by the AO to the Competent Authority of Hong Kong on December 4, 2018, sought information for Assessment Years 2011-12 to 2017-18, which included periods prior to the DTAA's effective date and was not demonstrably relevant to a subsequent fiscal event. Therefore, the reference was not in terms of the DTAA, and the benefit of exclusion of time under Explanation (ix) to Section 153B was not available. The Tribunal relied on the ratio laid down by the Delhi High Court (supra) and concluded that the assessments were barred by limitation and thus set aside. Consequently, Ground of Appeal No. 1 of the assessee was allowed, and other grounds were not adjudicated.

The Tribunal determined that the assessee had indeed rectified the defects, leading to the allowance of the miscellaneous application and the revival of the original appeal. Furthermore, noting that a similar quantum appeal had been remanded, the Tribunal also allowed ITA No.18/Del/2020 for statistical purposes and remanded it to the CIT(A) for de novo adjudication on merits, ensuring the assessee is given an opportunity of being heard.

The Tribunal held that the CIT(A)'s approach of deleting an addition based on additional evidence without obtaining a remand report from the AO was contrary to Rule 46A of the Income Tax Rules. The matter was remanded.

The Tribunal held that the assessment orders were barred by limitation. The primary issue revolved around the validity of the extension of the limitation period under Explanation (ix) to Section 153B of the Act, which allows for exclusion of time taken for exchange of information under an agreement referred to in Section 90 or Section 90A. The Tribunal noted that the Double Taxation Avoidance Agreement (DTAA) between India and Hong Kong came into force on November 30, 2018. According to Paragraph 5(c) of Article 26 of the DTAA, requests for information for periods prior to November 30, 2018, must be relevant to a fiscal year or taxable event occurring after that date. The reference made by the AO to the Competent Authority of Hong Kong on December 4, 2018, sought information for Assessment Years 2011-12 to 2017-18, which included periods prior to the DTAA's effective date and was not demonstrably relevant to a subsequent fiscal event. Therefore, the reference was not in terms of the DTAA, and the benefit of exclusion of time under Explanation (ix) to Section 153B was not available. The Tribunal relied on the ratio laid down by the Delhi High Court (supra) and concluded that the assessments were barred by limitation and thus set aside. Consequently, Ground of Appeal No. 1 of the assessee was allowed, and other grounds were not adjudicated.

The CIT(A) admitted the additional evidence after the AO failed to furnish a remand report, subsequently deleting the additions related to the unsecured loan and time deposit, confirming only the interest income. The Income Tax Appellate Tribunal (ITAT) upheld the CIT(A)'s order, finding that the CIT(A) had followed due procedure under Rule 46A of the Income Tax Rules and the revenue failed to controvert the findings based on verified documents.

The Tribunal held that the CIT(A)'s approach of deleting an addition based on additional evidence without obtaining a remand report from the AO was contrary to Rule 46A of the Income Tax Rules. The matter was remanded.

The tribunal held that the penalty order was legally infirm because the Assessing Officer initially initiated proceedings for 'furnishing inaccurate particulars' but later levied the penalty for 'concealment of income', with inconsistent notices. Relying on judicial precedents, the tribunal ruled that the penalty must be imposed only on the specific ground for which it was initiated, and the ambiguity in the charges rendered the penalty order void.

The Tribunal held that the reassessment proceeding under Section 147 was initiated during the pendency of the original assessment and before the expiry of the time limit for issuing notice under Section 143(2). This was considered an attempt to enlarge the time for assessment, making the entire proceeding void-ab-initio.

The Tribunal directed the AO to replace the income figure taken in the assessment order with the corrected figure after rectification. Regarding leave encashment, the AO was directed to verify the facts and allow the claim as per law. The grounds related to transfer pricing were dismissed.

The Tribunal held that levying a penalty under Section 271(1)(b) for non-compliance with notices, when the notices were allegedly not served on the correct address and this fact was not considered by the lower authorities, would be unfair and unjustified. The penalty was cancelled.

The Tribunal held that the payment of external development charges to HUDA attracts TDS deduction under Chapter XVII of the Income Tax Act. Therefore, the assessee's grievance was rejected.

The Tribunal found that while the assessee couldn't fully reconcile cash deposits, it could be presumed to be agricultural income and savings, considering their socio-economic status. A lumpsum addition of Rs. 1 lakh was deemed appropriate, without setting a precedent. For assessment under section 115BBE, it was noted that the provision applies from 01.04.2017.

The Tribunal held that the filing of Form 10 before the due date is a directory provision, not mandatory. Therefore, the disallowance based on the belated filing was erroneous.

The Tribunal, relying on the Hon'ble Apex Court's decision in Union of India vs. Rajeev Bansal, held that the approval for the Section 148 notice, issued after more than three years, was improperly obtained from a lower authority instead of the Principal Chief Commissioner or Principal Director General as mandated by Section 151(ii) of the new regime. Consequently, the reassessment proceedings were found unsustainable in law and quashed.

The Tribunal held that the filing of Form 10 before the due date is a directory provision, not mandatory. Therefore, the disallowance based on the belated filing was erroneous.

The Tribunal noted that the lower appellate authority proceeded ex-parte against the assessee. Considering the possibility of communication gaps due to the new faceless hearing system, the Tribunal decided to restore the appeal to the CIT(A)/NFAC for a fresh adjudication.

The Tribunal, observing that the deposits *prima facie* represented a cash component from the sale of an immovable property, reduced the unexplained cash deposit addition from Rs. 19.90 lakhs to a lumpsum of Rs. 1.90 lakhs. This decision provided relief of Rs. 18 lakhs to the assessee, with the rider that this specific addition should not be considered a precedent.

The Tribunal held that while the assessee's evidence of audited books and purchase entries could not be entirely disregarded, the failure to get relevant facts verified by the assessee in assessment and appellate proceedings was a significant factor. Considering these peculiar facts, the Tribunal deemed a lumpsum addition of Rs. 2 lakhs to be just and proper, with the rider that this would not be treated as a precedent. This grants the assessee relief of Rs. 40 lakhs on the disputed amount. Regarding the assessment under Section 115BBE, the Tribunal, relying on the Madras High Court's decision in S.M.I.L.E. Microfinance Ltd. Vs. ACIT, held that this provision comes into effect only for transactions done on or after 01.04.2017. Therefore, the assessee is directed to be assessed under the normal provisions as per law for the disputed period. No other grounds were pressed.

The Tribunal restored the appeal back to the CIT(A)/NFAC for fresh adjudication, acknowledging the possibility of communication gaps during virtual hearings. The assessee was granted three effective opportunities of hearing.

The Tribunal held that according to its Standing Order, the territorial jurisdiction is determined by the "situs" of the Assessing Officer's office. Since Fatehabad district was notified and excluded from Delhi benches' jurisdiction by 01.10.1997, the Delhi benches lacked the territorial jurisdiction to hear the appeal.

The tribunal, considering the interest of justice, granted the assessee one more opportunity to present their case. The matters were sent back to the Ld.CIT(A) for a fresh decision after the assessee participates and presents evidence.

The tribunal, considering the interest of justice, granted the assessee one more opportunity to present their case. The matters were sent back to the Ld.CIT(A) for a fresh decision after the assessee participates and presents evidence.

The Tribunal found merit in the assessee's contentions, noting that similar expenses were allowed in subsequent assessment years and in the assessee's own cases by co-ordinate benches. The Tribunal noted that the revenue could not distinguish the facts from previous favourable orders.

The Tribunal held that technicalities should not impede substantial justice and restored the appeal to the CIT(A)/NFAC. The CIT(A)/NFAC is directed to adjudicate the appeal on merits after providing three effective opportunities to the assessee.

The Tribunal condoned the delay in filing the appeal. Considering that the lower appellate authority had proceeded ex-parte, the Tribunal restored the appeal back to the CIT(A)/NFAC for a fresh adjudication within three effective opportunities.

The Tribunal dismissed both the assessee's appeals and the cross appeals by the Revenue as withdrawn. Liberty was granted to the assessee to revive the appeals should the application under the Vivad se Vishwas Scheme, 2024, fail to mature for any reason.

The Tribunal allowed the assessee's request to withdraw the appeals, noting that they had opted for the Vivad se Vishwas Scheme. Liberty was granted to revive the appeals if the scheme application fails.

The Tribunal acknowledged the possibility of communication gaps and, in the interest of justice, restored the appeal to the CIT(A) for a fresh adjudication. The assessee was granted three effective opportunities to present their case.

The Tribunal condoned a 231-day delay in filing the appeal and held that the initiation of assessment proceedings under Section 147/148 against a deceased person is unsustainable in law. Citing judicial precedent, the Tribunal quashed the impugned reopening of assessment.

The Tribunal held that a residential house consisting of several independent units should not be disallowed for Section 54 deduction, following a Supreme Court decision. It also allowed the cost of improvement, giving the benefit of doubt to the assessee.

The Tribunal dismissed both the assessee's appeals and the cross appeals by the Revenue as withdrawn. Liberty was granted to the assessee to revive the appeals should the application under the Vivad se Vishwas Scheme, 2024, fail to mature for any reason.

The Tribunal dismissed both the assessee's appeals and the cross appeals by the Revenue as withdrawn. Liberty was granted to the assessee to revive the appeals should the application under the Vivad se Vishwas Scheme, 2024, fail to mature for any reason.

The Tribunal, following judicial precedents, held that the limitation period for completing penalty proceedings under Section 275(1)(c) starts from the date the Assessing Officer makes a reference to the Addl. CIT for initiation of penalty. As the penalty order was passed beyond six months from this initiation date (10.10.2016), it was deemed barred by limitation and thus bad in law.

The Tribunal, following judicial precedents, held that the limitation period for completing penalty proceedings under Section 275(1)(c) starts from the date the Assessing Officer makes a reference to the Addl. CIT for initiation of penalty. As the penalty order was passed beyond six months from this initiation date (10.10.2016), it was deemed barred by limitation and thus bad in law.

The Tribunal found merit in the assessee's contentions, noting that similar expenses were allowed in subsequent assessment years and in the assessee's own cases by co-ordinate benches. The Tribunal noted that the revenue could not distinguish the facts from previous favourable orders.

The Tribunal found merit in the assessee's contentions, noting that similar expenses were allowed in subsequent assessment years and in the assessee's own cases by co-ordinate benches. The Tribunal noted that the revenue could not distinguish the facts from previous favourable orders.

The Tribunal found merit in the assessee's contentions, noting that similar expenses were allowed in subsequent assessment years and in the assessee's own cases by co-ordinate benches. The Tribunal noted that the revenue could not distinguish the facts from previous favourable orders.

The tribunal, citing the Supreme Court's decision in Union of India vs. Rajeev Bansal, held that Section 151(ii) approval for reassessment, where more than three years had passed, must be obtained under the 'new regime'. Since a valid Section 151(ii) approval was not secured, the Section 148 reassessment proceedings were deemed unsustainable and were accordingly quashed.

The Tribunal held that the Assessee should have been given an opportunity to produce documents and have the application decided on merit, as it claimed to be conducting charitable activities.

The Tribunal held that the approval under Section 153D must be accorded separately for each assessment year, even for a single assessee. Relying on various precedents, the Tribunal accepted the assessee's legal ground.

The Tribunal held that the Ld. CIT(E) should have provided an opportunity to the assessee to produce necessary documents and decide the application on its merit. Therefore, the Tribunal set aside the impugned orders and remanded the matter back to the Ld. CIT(E) for fresh adjudication.

The Tribunal held that the approval under Section 153D must be accorded separately for each assessment year, even for a single assessee. Relying on various precedents, the Tribunal accepted the assessee's legal ground.

The Tribunal held that the Ld. CIT(E) should have provided an opportunity to the assessee to produce necessary documents and decide the application on its merit. Therefore, the Tribunal set aside the impugned orders and remanded the matter back to the Ld. CIT(E) for fresh adjudication.

The Tribunal condoned the assessee's mistake in ticking the wrong exemption in the Income Tax Return in the interest of justice. The assessing authority was directed to finalize a fresh computation after verifying the facts.

The Tribunal held that the Assessee should have been given an opportunity to produce documents and have the application decided on merit, as it claimed to be conducting charitable activities.

The Tribunal held that a mechanical approval for reopening, as seen in this case, vitiates the entire reopening process. Therefore, the reopening was quashed based on the invalidity of the approval under Section 151 of the Act.

The Tribunal noted that the CIT(A) relied on a prior Tribunal order, and the Department did not provide evidence that this order was challenged or stayed by the High Court. Therefore, the Tribunal found no reason to interfere with the CIT(A)'s orders.

The Tribunal held that the assessments framed under Section 153A are non-est, invalid, void-ab-initio, illegal, and unlawful because no valid search warrant under Section 132 was issued in the assessee's name, which is a fundamental prerequisite for initiating Section 153A proceedings. Consequently, the Revenue's appeals were dismissed, and the assessee's cross-objections were allowed, thereby quashing the impugned assessments.

The Tribunal held that the compliance of filing Form 10-IE is a directory and not a mandatory provision. The Tribunal accepted the assessee's ground and directed the assessing authority to finalize computation.

The Tribunal held that the Assessing Officer had not recorded that the cash deposits represented income that had escaped assessment. Therefore, the Tribunal quashed the impugned reopening.