ITAT Delhi Judgments — August 2025

The Tribunal held that the AO's disallowances of interest, manufacturing expenses, and administrative/selling expenses were not substantiated by contrary facts. The CIT(A)'s deletion of interest and manufacturing expenses was upheld, and the disallowance of administrative and selling expenses was partly allowed.

The Tribunal held that the assumption of jurisdiction under Section 153C of the Act was vitiated due to a vague and cryptic satisfaction note, similar to previous cases. The assessment order was quashed on this legal ground, making the other grounds redundant.

The Tribunal held that the assessee had established the identity and creditworthiness of the suppliers, especially since the purchases were treated as genuine and the trading results were accepted. Therefore, Section 68 could not be invoked for the outstanding balances.

The Tribunal upheld the CIT(A)'s decision, finding that the commission payments were genuine and supported by evidence. It also held that the interest disallowance was unjustified as the assessee had sufficient interest-free funds to cover its investments.

The Tribunal found that while the assessee was in the motor vehicle trading business and some cash turnover was possible, he had not satisfactorily proved his case. A lump sum addition of Rs. 3 lakhs was deemed appropriate and just.

The Tribunal held that the AO's ad-hoc disallowance of 80% was not justified. The CIT(A) had rightly reduced the disallowance to 20%, but even this was found to be unsustainable as the expenditure was supported by employee declarations and an internal approval system.

The Tribunal held that the assessment order was invalid because the Assessing Officer failed to issue a mandatory notice under Section 143(2). This failure was considered a fatal flaw, as per the Supreme Court's decision in ACIT Vs. Hotel Blue Moon.

The Tribunal held that the addition made by the AO was a double addition as the cash sales were already part of the turnover accepted by the AO. The assessee had also provided sufficient evidence to prove the source of cash deposits.

The Tribunal held that the interest received under Section 28 of the Land Acquisition Act is an accretion to the value and part of enhanced compensation, not income from other sources. The Tribunal relied on Supreme Court decisions affirming this position.

The Tribunal found that the assessee's grievances were not properly adjudicated by the CIT(A) as the assessee had not filed submissions before the first appellate authority. Therefore, the appeals were restored to the file of the CIT(A) for fresh adjudication.

The Tribunal upheld the CIT(A)'s decision to delete the additions. It noted that SEBI's subsequent investigation cleared the company and revoked the interim orders, finding no adverse evidence of manipulation. The AO had also failed to conduct independent inquiries.

The Tribunal held that the NFAC erred in dismissing the appeal on a technicality without considering the merits, especially since the AO had passed an ex-parte order. The Tribunal restored the matter to the AO to grant the assessee a final opportunity to present its case.

The Tribunal, referring to various High Court decisions and noting the absence of guidance from the jurisdictional High Court, adopted the view favoring the assessee. The Tribunal reversed the action of the lower authorities in assessing interest on enhanced compensation.

The Tribunal held that the notices issued under Section 148 were invalid as they were not sanctioned by the appropriate authority as required by the amended Section 151 of the Act. Consequently, the reopening proceedings and the subsequent assessment orders were quashed.

The Tribunal held that the AO was not justified in making the addition under Section 68. The Tribunal noted that the AO had allowed interest deduction on these loans, implying acceptance of the lenders' genuineness. Furthermore, the loans were repaid, and the AO failed to bring contrary evidence to rebut the assessee's explanation.

The Tribunal held that the approval granted under Section 153D was mechanical and ritualistic, lacking application of mind. Citing various High Court and Supreme Court judgments, the Tribunal found that such a flawed approval vitiates the assessment order.

The Tribunal held that the assumption of jurisdiction under Section 153C of the Act was vitiated due to a vague and cryptic satisfaction note, similar to previous cases. The assessment order was quashed on this legal ground, making the other grounds redundant.

The Tribunal held that the approval granted under Section 153D was mechanical and ritualistic, lacking application of mind. Citing various High Court and Supreme Court judgments, the Tribunal found that such a flawed approval vitiates the assessment order.

The Tribunal held that the notices under Section 148 were invalid because the approval for reassessment was not obtained from the specified authority as required by Section 151(ii) of the Act, as more than three years had elapsed from the end of the relevant assessment years.

The Tribunal held that the approval granted under Section 153D was mechanical and ritualistic, lacking application of mind. Citing various High Court and Supreme Court judgments, the Tribunal found that such a flawed approval vitiates the assessment order.

The Tribunal held that no penalty could survive on estimated income, as there cannot be partial concealment or non-concealment. Therefore, the levy of penalty u/s 271(1)(c) was directed to be deleted.

The Tribunal held that if the very basis for forming the belief for reassessment does not result in any addition in the reassessment order, then the entire reassessment proceedings would be void ab initio. The Tribunal quashed the reassessment proceedings on this ground.

The Tribunal held that the approval granted under Section 153D was mechanical and ritualistic, lacking application of mind. Citing various High Court and Supreme Court judgments, the Tribunal found that such a flawed approval vitiates the assessment order.

The Tribunal upheld the CIT(A)'s decision, finding that the commission payments were genuine and supported by evidence. It also held that the interest disallowance was unjustified as the assessee had sufficient interest-free funds to cover its investments.

The Tribunal held that the approval granted under Section 153D was mechanical and ritualistic, lacking application of mind. Citing various High Court and Supreme Court judgments, the Tribunal found that such a flawed approval vitiates the assessment order.

The tribunal condoned the delay and admitted the appeal. It was found that the NFAC passed an ex-parte order without proper adjudication. Therefore, the case was restored to the AO for fresh adjudication.

The Tribunal held that the CIT(A) rightly exercised the power under Section 251(1) of the Act by remanding the matter for de-novo assessment, especially since the original assessment was ex-parte. Therefore, the Tribunal found no reason to interfere with the CIT(A)'s order.

The Tribunal noted that substantial additions in the case of Sh. Atul Tyagi were confirmed by the Ld. CIT(A) and no further appeal was preferred by him, meaning those additions had reached finality. Consequently, the present appeal challenging the protective additions did not survive.

The Tribunal held that the approval granted under Section 153D was mechanical and ritualistic, lacking application of mind. Citing various High Court and Supreme Court judgments, the Tribunal found that such a flawed approval vitiates the assessment order.

The Tribunal held that the AO's disallowances of interest, manufacturing expenses, and administrative/selling expenses were not substantiated by contrary facts. The CIT(A)'s deletion of interest and manufacturing expenses was upheld, and the disallowance of administrative and selling expenses was partly allowed.

The Tribunal held that the notice issued under Section 143(2) was not in the prescribed format as per CBDT instructions, making it an invalid notice. Consequently, all subsequent assessment proceedings were deemed invalid and void ab initio.

The Tribunal held that the assessee had provided sufficient evidence, including invoices, e-way bills, and bank statements, to substantiate the purchases. The revenue failed to provide any evidence to disprove the genuineness of the purchases. Therefore, the addition made by the AO and sustained by the CIT(A) was deleted.

The Tribunal held that the CIT(A) rightly exercised its power under Section 251(1) of the Act to remand the matter for de-novo assessment, especially since the original assessment was ex-parte. The Tribunal found no reason to interfere with the CIT(A)'s order.

The Tribunal held that the assessee had discharged its primary onus by providing identity and demonstrating genuineness of transactions, with no additions made for similar loans in other years. Furthermore, the addition concerning donation was found unsustainable as it was part of the books and no show-cause notice was issued for it, violating natural justice. The sanction for reopening for AY 2015-16 was also found to be invalid due to jurisdictional error.

The Tribunal condoned the delay in filing the appeal. Finding that the NFAC had decided the issue ex parte without independent findings, the Tribunal restored the appeal to the NFAC for de novo adjudication.

The Tribunal held that the assessee had discharged its primary onus by providing identity and demonstrating genuineness of transactions, with no additions made for similar loans in other years. Furthermore, the addition concerning donation was found unsustainable as it was part of the books and no show-cause notice was issued for it, violating natural justice. The sanction for reopening for AY 2015-16 was also found to be invalid due to jurisdictional error.

The Tribunal condoned the delay in filing the appeals before the Ld. CIT(A) by citing the Hon'ble Supreme Court's decision in Collector, Land & Acquisition vs. Mst. Katiji & Others, emphasizing that justifiable reasons should lead to substantial justice. The matter was remanded to the Ld. CIT(A) for fresh adjudication on merits.

The Tribunal held that as per the Supreme Court decision in Checkmate Services Pvt. Ltd., employee's contributions deducted from salary and held in trust are deemed income under Section 2(24)(x) and their deductibility under Section 36(1)(va) is conditional upon deposit on or before the due date. Therefore, the disallowance was justified.

The Tribunal condoned the delay in filing the appeals before the Ld. CIT(A) by citing the Hon'ble Supreme Court's decision in Collector, Land & Acquisition vs. Mst. Katiji & Others, emphasizing that justifiable reasons should lead to substantial justice. The matter was remanded to the Ld. CIT(A) for fresh adjudication on merits.

The Tribunal found that the CIT(A) had rightly considered judicial precedents regarding depreciation not being a double deduction for charitable institutions and set aside the issue to the AO for examination. The Tribunal also upheld the CIT(A)'s deletion of additions related to unsecured loans, cessation of liability, and car expenses, finding the AO's reliance on investigation reports to be overstretched.

The Tribunal held that the unsecured loan addition under Section 68 was justified due to the lack of convincing explanation regarding the source of funds. However, the addition under Section 14A was deleted as no exempt income was earned. The addition under Section 36(1)(iii) was affirmed as the assessee failed to establish commercial expediency for advancing interest-free loans to sister concerns.

The Tribunal noted that both the lower authorities had passed ex-parte orders. The AO completed the assessment ex-parte due to the assessee's non-compliance, and the CIT(A) dismissed the appeal for non-compliance. The Tribunal acknowledged that while the assessee did not file submissions before the NFAC, the appeal should ideally be decided on merits. Considering the totality of the facts and circumstances, and in the interest of justice, the Tribunal deemed it proper to restore the issue to the file of the Assessing Officer. The AO was directed to grant one final opportunity to the assessee to substantively present its claim and decide the issue based on facts and law. The assessee was also directed to appear before the AO and cooperate with the proceedings. The grounds raised by the assessee were allowed for statistical purposes. The Tribunal did not decide the substantive issues raised by the assessee but remanded the matter for fresh consideration.

The Tribunal held that merely not finding the assessee at the given address during a search does not constitute incriminating material. Therefore, additions made without specific seized material, as per the precedent of PCIT v. Abhisar Buildwell, are not valid.

The Tribunal held that the notice issued under Section 143(2) was invalid as it did not comply with the mandatory CBDT instructions regarding its format. Consequently, the assessment framed based on this invalid notice was also quashed.

The Tribunal held that the assessee, a salaried individual, declared income from a success bonus of Rs. 1,27,28,304/-, claimed TDS of Rs. 45,82,189/-, and also deposited Rs. 8,05,250/- as additional income tax. It was noted that there was a failure on the part of the employer to deposit TDS of Rs. 45,42,189/-. The assessee had submitted a letter from the employer regarding the bonus and emails requesting Form 16. In the interest of justice, the Tribunal set aside the orders of the Ld. CIT(A) and Ld. AO. The matter was restored to the file of the Ld. AO with directions to verify the factum of TDS deduction by the employer and decide the issue afresh after providing a fair opportunity of hearing to the assessee. The Tribunal did not decide the issue on merits but remanded it for verification.

The Tribunal held that the approval granted under Section 153D was mechanical and ritualistic, lacking application of mind. Citing various High Court and Supreme Court judgments, the Tribunal found that such a flawed approval vitiates the assessment order.

The Tribunal held that the AO's disallowances of interest, manufacturing expenses, and administrative/selling expenses were not substantiated by contrary facts. The CIT(A)'s deletion of interest and manufacturing expenses was upheld, and the disallowance of administrative and selling expenses was partly allowed.

The Tribunal noted that the AO treated two companies, UV Credit Solutions and Cloister Realtors, as shell companies based on their financial data from the MCA portal and the assessee's submissions. The AO observed that their primary source of funds was share capital and premium, and they were either loss-making or had returns inconsistent with the premium received, indicating a lack of tangible business activities. The AO made an addition of Rs. 6.75 crores. The CIT(A) deleted the addition of Rs. 5.75 crores concerning Cloister Realtors, but confirmed an addition of Rs. 1 crore concerning UV Credit Solutions. The Tribunal observed that the AO had not provided any adverse material to disprove the identity, capacity, and genuineness of the creditors, especially when the assessee had furnished all the required documents. The Tribunal found that the CIT(A) had correctly appreciated the submissions of the assessee and deleted the addition of Rs. 5.75 crores. However, the Tribunal found that the CIT(A) had erred in confirming the addition of Rs. 1 crore in respect of UV Credit Solutions without proper appreciation of facts and evidence. Therefore, the Tribunal set aside the order of the CIT(A) concerning the addition of Rs. 1 crore and remanded the issue back to the AO for fresh adjudication after providing an opportunity to the assessee to produce the necessary evidence. The appeals were disposed of accordingly.

The Tribunal held that the addition made by the AO for AY 2013-14 was a double addition as the amounts were already accounted for as sales receipts. The additions for AY 2014-15 were also deleted as the CIT(A) found merit in the assessee's explanation and cross-verified trade receivables.

The Tribunal held that the addition made by the AO for AY 2013-14 was a double addition as the amounts were already accounted for as sales receipts. The additions for AY 2014-15 were also deleted as the CIT(A) found merit in the assessee's explanation and cross-verified trade receivables.