ITAT Delhi Judgments — September 2025

The Tribunal held that the assessment year in question was beyond the maximum time period of 10 years from the date of satisfaction recorded under Section 153C of the Act. This was in line with previous decisions concerning identical facts.

The Tribunal held that since the assessee is a Local Authority whose income is exempted under section 10(46) and is not engaged in business or profession, the provisions of section 44AA are not applicable. Therefore, no penalty could be levied for non-maintenance of books of account.

The Tribunal held that the additional ground of appeal concerning the validity of the assessment order due to mechanical approval under Section 153D was admissible. It further held that the assessment order was void-ab-initio as the approval granted was mechanical and without application of mind.

The Tribunal condoned the delay in filing the appeal, citing the Supreme Court's liberal approach to condonation of delays with sufficient cause. The Tribunal found that both the AO and CIT(A) orders were ex-parte, and restored the issue to the AO for de-novo assessment, providing an opportunity to the assessee.

The Tribunal held that the assessee has the option to choose between the NAV and DCF methods for valuation under Rule 11UA. Once an option is chosen, the AO cannot change the method or substitute their own valuation. The AO's comparison of projected figures with past actuals was also found to be incorrect.

The Tribunal held that the non-mentioning of a specific limb of Section 270A(3) in the penalty notice vitiates the entire penalty proceedings. Therefore, the penalty imposed by the AO and confirmed by the CIT(A) was deleted.

The Tribunal held that there was no principal-to-agent relationship between the assessee and the payment gateways, but rather a principal-to-principal relationship. Therefore, the payments did not fall under Section 194H, and TDS was not deductible.

The Tribunal held that there was no principal-to-agent relationship between the assessee and the payment gateways, but rather a principal-to-principal relationship. Therefore, the payments did not fall under Section 194H, and TDS was not deductible.

The Tribunal found that the Assessee should be given an opportunity to furnish the required documents for the 'other expenses'. Consequently, the matter was remanded back to the Assessing Officer with directions to allow the Assessee to produce all necessary evidence and then pass a fresh assessment order in accordance with law.

The Tribunal held that there was no principal-to-agent relationship between the assessee and the payment gateways, but rather a principal-to-principal relationship. Therefore, the payments did not fall under Section 194H, and TDS was not deductible.

The Tribunal noted that the CIT(A) passed an ex-parte order without providing an opportunity of being heard. Considering the interests of justice, the Tribunal remanded the issue back to the AO for a de-novo assessment.

The Tribunal held that the additional ground of appeal concerning the validity of the assessment order due to mechanical approval under Section 153D was admissible. It further held that the assessment order was void-ab-initio as the approval granted was mechanical and without application of mind.

The Tribunal found that the facts regarding the exact nature of payments for IT and product design services were not sufficiently on record. Consequently, the matter was restored to the Assessing Officer for fresh adjudication.

The Tribunal held that if the existence of stock and cash sales are not doubted by the Assessing Officer, and the cash deposits are explained as proceeds from these sales, then no addition under Section 68 is warranted. The Tribunal followed various High Court and ITAT decisions supporting this view.

The Tribunal held that the full facts regarding the nature of payments for IT services and product design were not on record. Therefore, the matter was restored to the AO for fresh adjudication.

The Tribunal held that the disallowance under Section 40(a)(i) would not survive because the consequent liability under Section 201(1)/201(1)(a) was settled under the VSV Scheme. Relying on CBDT Circular No. 7/2020, the assessee was entitled to consequential relief.

The Tribunal held that for notices issued under Section 148 after three years from the end of the relevant assessment year, approval must be obtained from the Principal Chief Commissioner/Principal Director General or Chief Commissioner/Director General, as per Section 151(ii) of the Act. Since approval was obtained from the Principal Commissioner of Income Tax, which is not the competent authority in such cases, the assessment orders were quashed.

The Tribunal held that the Principal Commissioner of Income Tax (PCIT) erred in exercising revisionary powers under Section 263. The AO had conducted sufficient inquiries during the assessment, and the PCIT's revised opinion lacked new supporting documents.

The Tribunal held that goodwill is an intangible asset eligible for depreciation under Section 32 of the Income Tax Act. The Supreme Court's decision in Smifs Securities Ltd. was cited as precedent, and the amendment by the Finance Act 2021 was noted as prospective.

The Tribunal held that the Principal Commissioner of Income Tax (PCIT) erred in exercising revisionary powers under Section 263. The AO had conducted sufficient inquiries during the assessment, and the PCIT's revised opinion lacked new supporting documents.

The Tribunal held that the Principal Commissioner of Income Tax (PCIT) erred in exercising revisionary powers under Section 263. The AO had conducted sufficient inquiries during the assessment, and the PCIT's revised opinion lacked new supporting documents.

The Tribunal held that goodwill is an intangible asset eligible for depreciation under Section 32 of the Income Tax Act. The Supreme Court's decision in Smifs Securities Ltd. was cited as precedent, and the amendment by the Finance Act 2021 was noted as prospective.

The Tribunal held that the satisfaction note recorded by the AO was vague and not in accordance with the provisions of Section 153C of the Act, as it did not specify the incriminating documents, relate them to specific assessment years, or quantify the amount. Therefore, the assumption of jurisdiction under Section 153C was deemed bad in law.

The Tribunal condoned the delay of 869 days, citing the Supreme Court's decision in Collector, Land & Acquisition vs. Mst. Katiji & Others, emphasizing substantial justice. The Tribunal set aside the impugned order of the Ld. CIT(E) and remanded the matter for fresh decision after providing an opportunity of being heard to the assessee.

The Tribunal held that there was sufficient cause and reason for the delay in filing the appeal. Consequently, the delay was condoned, and the appeal was admitted.

The Tribunal held that the CIT(Appeals) did not adjudicate the legal grounds or the merits of the addition. Therefore, the appeal was restored to the file of the CIT(Appeals) to adjudicate all grounds after providing an opportunity to the assessee.

The Tribunal held that the reassessment proceedings were bad in law because the notice under Section 148 was issued on March 31, 2021, but served on April 1, 2021. This service date fell after the amendments to Section 148A and 148 of the Act, requiring the old procedure to be followed, which was not done.

The Tribunal held that the notice issued under Section 143(2) was invalid as it was not in the prescribed format as per CBDT instructions. Consequently, the assessment framed based on this notice was also quashed.

The Tribunal held that the additional ground of appeal concerning the validity of the assessment order due to mechanical approval under Section 153D was admissible. It further held that the assessment order was void-ab-initio as the approval granted was mechanical and without application of mind.

The Tribunal upheld the order of the CIT(A), finding that the assessee had discharged the onus of proving the identity, creditworthiness, and genuineness of the transaction related to the share application money. Reliance was placed on various judicial precedents.

The Tribunal ruled that the assessee is entitled to the deduction under Section 80JJAA, considering the late filing of the revised Form 10DA as a procedural omission, citing previous High Court and ITAT judgments. The matter was remanded to the AO solely for the quantification of the deduction. Consequently, the penalty levied under Section 270A, which was based on the disallowed deduction, was also set aside.

The Tribunal held that the Marketing Support Expenses were allowable as business expenses, Director's Remuneration was not excessive or unreasonable, and R&D Expenses incurred before the certificate date were also allowable based on High Court precedents. Consequently, the disallowances made by the AO were deleted.

The Tribunal held that since the assessee had settled the issue under the Vivad se Vishwas Act, the Revenue could not reagitate the matter, as it would lead to double taxation and defeat the purpose of the Act. The Tribunal also noted that similar facts in the case of M/s. VSS Sales were decided in favour of the assessee, leading to the dismissal of the Revenue's appeal.

The Tribunal observed that the appeal was dismissed ex parte due to a delay in filing. Considering the facts, the Tribunal restored the matter to the CIT(A) to decide afresh after giving the assessee an adequate opportunity to explain the delay.

The Tribunal held that the satisfaction note recorded by the AO was vague and not in accordance with the provisions of Section 153C of the Act, as it did not specify the incriminating documents, relate them to specific assessment years, or quantify the amount. Therefore, the assumption of jurisdiction under Section 153C was deemed bad in law.

The Tribunal held that the Principal CIT lacked jurisdiction to revise the assessment order under Section 263 because the issues forming the basis of the revision were already pending before the CIT(A). Therefore, the revisionary order was quashed.

The Tribunal held that interest received on enhanced compensation is taxable under the head 'Income from other sources' as per Section 56(2)(viii) of the Income Tax Act, 1961, following the amendments made by the Finance Act, 2009. The assessee's claim for exemption under Section 10(37) was not accepted.

The Tribunal condoned the delay in filing the appeal, finding no intentional laches on the part of the assessee. The Tribunal acknowledged the communication breakdown among professionals and the potential irreparable loss to the assessee if the appeal was not admitted.

The Tribunal allowed the assessee's appeals by quashing the assessment orders. The primary basis for this decision was the additional ground of appeal concerning the approval granted under Section 153D of the Income Tax Act. The Tribunal found that the approval granted by the Additional CIT was mechanical and lacked application of mind. It was a common approval for multiple assessment years and assessees, without specific reference to the material on record or the issues involved. The Tribunal relied on judicial precedents, including the decision in Dheeraj Chaudhary vs. ACIT, which held that a mechanical approval under Section 153D vitiates the assessment order. The Tribunal emphasized that the approval is a safeguard against arbitrary exercise of power and requires the approving authority to apply its mind to the facts of the case. Since the procedure outlined in the CBDT Manual was not followed, the approval was considered an empty formality. Consequently, the assessment orders were held to be vitiated and quashed. As the additional ground of appeal was allowed, other grounds were not adjudicated. The appeals for both AY 2012-13 and 2013-14 were allowed on identical grounds.

The Tribunal ruled that the assessee is entitled to the deduction under Section 80JJAA, considering the late filing of the revised Form 10DA as a procedural omission, citing previous High Court and ITAT judgments. The matter was remanded to the AO solely for the quantification of the deduction. Consequently, the penalty levied under Section 270A, which was based on the disallowed deduction, was also set aside.

The Tribunal allowed the assessee's appeals by quashing the assessment orders. The primary basis for this decision was the additional ground of appeal concerning the approval granted under Section 153D of the Income Tax Act. The Tribunal found that the approval granted by the Additional CIT was mechanical and lacked application of mind. It was a common approval for multiple assessment years and assessees, without specific reference to the material on record or the issues involved. The Tribunal relied on judicial precedents, including the decision in Dheeraj Chaudhary vs. ACIT, which held that a mechanical approval under Section 153D vitiates the assessment order. The Tribunal emphasized that the approval is a safeguard against arbitrary exercise of power and requires the approving authority to apply its mind to the facts of the case. Since the procedure outlined in the CBDT Manual was not followed, the approval was considered an empty formality. Consequently, the assessment orders were held to be vitiated and quashed. As the additional ground of appeal was allowed, other grounds were not adjudicated. The appeals for both AY 2012-13 and 2013-14 were allowed on identical grounds.

The Tribunal condoned the delay in filing the appeal. It admitted the additional ground and held that the notice issued under Section 143(2) was invalid as it was not in the prescribed format as per CBDT instructions, thereby quashing the assessment.

The Tribunal held that an intimation u/s 143(1) making adjustments without providing prior opportunity to the assessee is invalid, as stipulated by the proviso to Section 143(1)(a). It further ruled that the CPC's action of changing the assessee's chosen taxation option under Section 115BAA from "no" to "yes" is beyond the permissible scope of Section 143(1) of the Act. Consequently, the adjustment made by the CPC was directed to be deleted.

The Tribunal held that the CIT(A)'s rectification order was bad in law as the Supreme Court judgment relied upon was delivered after the original CIT(A) order and cannot be applied retrospectively. The powers under section 154 are not for reviewing earlier orders based on subsequent judicial pronouncements.

The Tribunal held that an assessment under Section 153A is not valid when incriminating material is found with a third party but not with the assessee, especially for unabated assessments. It emphasized that proceedings should have been initiated under Section 153C if material was found with a third party. Following the Delhi High Court's decision in PCIT vs. Anand Kumar Jain, the Tribunal set aside the assessment order for being without jurisdiction.

The Tribunal held that for reassessment notices issued after three years, approval must be obtained from the Principal Chief Commissioner/Director General, not just the Principal Commissioner. Since the approval was granted by the PCIT, the assessment orders were quashed.

The Tribunal condoned the delay of 169 days, citing the Supreme Court's liberal approach to delay with sufficient cause. The Tribunal also noted that the CIT(A) had passed an ex-parte order without providing the assessee an opportunity to be heard and without deciding all grounds on merit.

The Tribunal condoned the 13-day delay in filing the Revenue's appeal, finding reasonable cause due to the AO being engaged in time-barring matters. Regarding the maintainability of the appeal, the Tribunal noted that the Hon'ble Madras High Court in SMILE Microfinance Ltd. v. ACIT (WP(MD) No. 2078 of 2020 & 1742 of 2020 dated 19.11.2024) had settled the issue that Section 115BBE applies only to transactions on or after 01.04.2017. Since the assessment year in question is 2017-18, and the AO invoked section 115BBE, the Tribunal concluded that the consequential tax effect computation was affected. Therefore, the Revenue's appeal was found to be hit by CBDT Circular No. 09 of 2024 on account of low tax effect, as per normal provisions. The Tribunal dismissed the Revenue's appeal, granting liberty to the Revenue to move an application if the case falls under any exception.

The Tribunal held that the satisfaction note recorded by the AO was vague and not in accordance with the provisions of Section 153C of the Act, as it did not specify the incriminating documents, relate them to specific assessment years, or quantify the amount. Therefore, the assumption of jurisdiction under Section 153C was deemed bad in law.

The Tribunal held that the failure to file the return of income does not automatically amount to concealment, especially when the assessee is a salaried employee and the income was declared upon notice. The penalty was levied without sufficient justification and consideration of the assessee's submissions.