ITAT Delhi Judgments — May 2026

The Tribunal held that the PCIT's invocation of Section 17(2) to treat the jewellery purchase expense as a perquisite in the assessee's hands was unjustified. There was no employer-employee relationship established, and the expense was made by a company out of its unaccounted cash.

The Tribunal held that the interest paid for delayed license fee payment was revenue expenditure. It also held that intangible assets acquired under a slump sale agreement were 'business or commercial rights of similar nature' eligible for depreciation.

The Tribunal held that the assessee is eligible for depreciation on non-compete fees. This decision was based on the principle of consistency and prior ITAT rulings in the assessee's own case for earlier assessment years.

The Tribunal held that the CIT(A) erred by rejecting additional evidence without following established jurisprudence and prioritizing technicalities over substantive justice. The matter was restored to the CIT(A) for fresh adjudication.

The Tribunal found that the CIT(A) had passed an ex-parte order without giving the assessee sufficient opportunities to present its case. Therefore, the matter was set aside to the CIT(A) for fresh adjudication with directions for effective opportunities to be granted.

The Tribunal held that the reassessment proceedings were initiated based on borrowed satisfaction and without independent inquiry. Furthermore, the Tribunal found that the assessee had discharged its onus by providing documentary evidence for the identity, creditworthiness, and genuineness of the loan transactions.

The tribunal allowed the assessee to withdraw the appeal as per their application. The withdrawal was based on an order giving effect which had deleted the entire transfer pricing adjustment.

The Tribunal restored the matter to the Assessing Officer for de novo verification of the credit card payments and Chapter VI-A deductions. The assessee is to provide necessary evidence to substantiate its claims regarding the source and nature of the credit card payments and the deductions.

The Tribunal held that the assessee is eligible for depreciation on non-compete fees. This decision was based on the principle of consistency and prior ITAT rulings in the assessee's own case for earlier assessment years.

The Tribunal held that in unabated/completed assessment years, additions under section 153A can only be made if incriminating material is found during the search. Since no such material was found, the additions were not sustainable.

The Tribunal held that in unabated/completed assessment years, additions under section 153A can only be made if incriminating material is found during the search. Since no such material was found, the additions were not sustainable.

The Tribunal condoned the delay and admitted the appeal. It held that the CIT(A) erred by not considering the additional evidence filed by the assessee, especially since the assessee claimed the AO did not provide sufficient opportunity or issue a show cause notice.

The Tribunal held that additions should be based on seized material. Since no incriminating material was found for purchases from parties other than JBM group, those additions were deleted. For JBM group purchases, additions were confirmed only to the extent of transactions found in the WhatsApp image, as the individual admitted those.

The Tribunal held that additions should be based on seized material. Since no incriminating material was found for purchases from parties other than JBM group, those additions were deleted. For JBM group purchases, additions were confirmed only to the extent of transactions found in the WhatsApp image, as the individual admitted those.

The Tribunal held that additions should be based on seized material. Since no incriminating material was found for purchases from parties other than JBM group, those additions were deleted. For JBM group purchases, additions were confirmed only to the extent of transactions found in the WhatsApp image, as the individual admitted those.

The Tribunal held that taxing the forfeited loans in AY 2020-21, when they were already offered to tax in AY 2023-24, would result in double taxation. Therefore, the addition made in AY 2020-21 was deleted.

The Tribunal held that the notice under Section 148 was invalid because it was issued without the approval of the prescribed authority, the Principal Chief Commissioner (PCCIT)/Chief Commissioner (CCIT), as mandated by Section 151(ii) of the Act. Consequently, the notice and the reassessment order were quashed.

The Tribunal held that since the AO had not rejected the assessee's books of accounts and the cash sales were reflected therein, making an addition for cash deposits would amount to double taxation. The Tribunal also noted that Section 115BBE, imposing a higher tax rate, was not applicable for the assessment year in question.

The Tribunal held as follows: 1. Regarding the addition of Rs. 5,29,653 for credit card bills, the Tribunal found that in light of the sworn statement of Prateek Jain and the reimbursement evidence, the expenditure on the credit card was explained. The Tribunal noted the absence of any evidence regarding commission received by the assessee from his friend, making an addition purely on an estimated basis unjustified. Therefore, the addition of Rs. 5,79,653 was directed to be deleted, allowing grounds 2 & 3 in favor of the assessee. 2. Concerning the addition of Rs. 15,00,000 for gifts from relatives, the Tribunal observed that the assessee had filed evidence such as gift deeds, bank statements, and confirmations. For the gift from the deceased father, a confirmation from the mother was provided. The Tribunal concluded that the onus to establish the genuineness of the gifts was adequately discharged by the assessee, and thus no addition was warranted. The addition of Rs. 15,00,000 under section 69A was deleted. 3. On the issue of credit card reward points (Rs. 1,97,766), the Tribunal held that since the reward points were earned on credit card expenses incurred by Prateek Jain, they were rightly considered a gift taxable under section 56(2)(x). The assessee's appeal on this ground was rejected, and the decision to tax the amount after allowing the threshold exemption of Rs. 50,000 was upheld. 4. Regarding the cash deposit of Rs. 2,27,000, the Tribunal agreed with the assessee's submission that the source and purpose of the deposits were satisfactorily explained as reimbursement by Prateek Jain. Accordingly, the addition of Rs. 2,27,000 under section 69A was deleted. The operative direction was to delete the additions related to credit card bills, gifts from relatives, and cash deposits, while upholding the addition on reward points.

The Tribunal upheld the CIT(A)'s decision, finding that the assessee had provided sufficient evidence, including cash books, sales invoices, and bank statements, to explain the cash deposits as recorded business turnover. The Assessing Officer had not rejected the books of accounts or questioned the sales.

The Tribunal held that the assessment order for AY 2021-22 was vitiated due to a significant delay in recording the satisfaction note by the Assessing Officer, exceeding the permissible period as per judicial pronouncements. Consequently, the penalty orders for all assessment years were also held unsustainable.

The Tribunal held that the assessment order for AY 2021-22 was vitiated due to a delay in recording the satisfaction note by the Assessing Officer, exceeding the six-month period prescribed by judicial pronouncements. Consequently, the penalty orders for all assessment years were also deemed unsustainable.

The Tribunal held that additions should be based on seized material. Since no incriminating material was found for purchases from parties other than JBM group, those additions were deleted. For JBM group purchases, additions were confirmed only to the extent of transactions found in the WhatsApp image, as the individual admitted those.

The Tribunal held that the assessment order for AY 2021-22 was vitiated due to a significant delay in recording the satisfaction note by the Assessing Officer, exceeding the permissible period as per judicial pronouncements. Consequently, the penalty orders for all assessment years were also held unsustainable.

The Tribunal held that the tax effect in the Revenue's appeal was below the monetary limit prescribed by the CBDT circular. Therefore, the appeal was not maintainable. The Tribunal followed decisions of the Madras High Court and coordinate benches.

The Tribunal held that the assessment order for AY 2021-22 was vitiated due to a significant delay in recording the satisfaction note by the Assessing Officer, exceeding the permissible period as per judicial pronouncements. Consequently, the penalty orders for all assessment years were also held unsustainable.

The Tribunal dismissed the Revenue's appeals. On the issue of FTS, the Tribunal noted that the CIT(A) followed the Tribunal's own order in the assessee's own case for AY 2015-16. Regarding the VSPE, the Tribunal relied on a High Court decision which held that Article 5(6) of the India-Singapore DTAA contemplates rendition of services by employees physically present within the country. The High Court explicitly stated that the concept of a virtual service permanent establishment does not find mention in the DTAA and that provisions of the DTAA must be interpreted strictly. The Tribunal concluded that since the DTAA does not contemplate VSPE and requires physical presence of employees, the CIT(A)'s finding that the assessee did not have a service PE in India was correct. Therefore, the grounds raised by the Revenue on both issues were dismissed.

The Tribunal dismissed the Revenue's appeals. On the issue of FTS, the Tribunal noted that the CIT(A) followed the Tribunal's own order in the assessee's own case for AY 2015-16. Regarding the VSPE, the Tribunal relied on a High Court decision which held that Article 5(6) of the India-Singapore DTAA contemplates rendition of services by employees physically present within the country. The High Court explicitly stated that the concept of a virtual service permanent establishment does not find mention in the DTAA and that provisions of the DTAA must be interpreted strictly. The Tribunal concluded that since the DTAA does not contemplate VSPE and requires physical presence of employees, the CIT(A)'s finding that the assessee did not have a service PE in India was correct. Therefore, the grounds raised by the Revenue on both issues were dismissed.

The Tribunal held that the jurisdictional defect in issuing the notice under section 143(2) was not raised within the prescribed time limit as per section 124(3)(a) of the Act. On merits, the Tribunal found that the cash book did not sufficiently support the claim of sufficient cash balance for the withdrawal.

The Tribunal dismissed the Revenue's appeals. On the issue of FTS, the Tribunal noted that the CIT(A) followed the Tribunal's own order in the assessee's own case for AY 2015-16. Regarding the VSPE, the Tribunal relied on a High Court decision which held that Article 5(6) of the India-Singapore DTAA contemplates rendition of services by employees physically present within the country. The High Court explicitly stated that the concept of a virtual service permanent establishment does not find mention in the DTAA and that provisions of the DTAA must be interpreted strictly. The Tribunal concluded that since the DTAA does not contemplate VSPE and requires physical presence of employees, the CIT(A)'s finding that the assessee did not have a service PE in India was correct. Therefore, the grounds raised by the Revenue on both issues were dismissed.

The Tribunal held that the CIT(A) erred in not admitting the additional claim for deduction under Section 80M, as appellate authorities are empowered to entertain fresh claims. The matter was remanded to the AO for verification of the eligible deduction amount.

The Tribunal held that the assessment year 2021-22 falls within the six-year block period, and the assessment should have been made under Section 153C, not Section 143(3). The order passed under Section 143(3) was deemed bad in law.

The Tribunal held that the Assessing Officer should not have resorted to Section 143(1) for a debatable issue, especially when the matter was pending before the Supreme Court. The disallowance made under Section 143(1) was set aside.

The Tribunal held that the Assessing Officer should not have resorted to Section 143(1) for a debatable issue, especially when the matter was pending before the Supreme Court. The disallowance made under Section 143(1) was set aside.

The Tribunal quashed the reassessment proceedings, finding that the AO failed to record reasons for the assessee's failure to disclose material facts, violating the first proviso to Section 147. Additionally, the AO's reasons were based on factually incorrect assumptions.

The CIT(A) deleted the addition, finding that the assessee had maintained proper books of accounts and provided sufficient evidence to explain the nature and source of the cash deposits. The Tribunal found no reason to interfere with the CIT(A)'s findings.

The Tribunal dismissed the Revenue's appeals. On the issue of FTS, the Tribunal noted that the CIT(A) followed the Tribunal's own order in the assessee's own case for AY 2015-16. Regarding the VSPE, the Tribunal relied on a High Court decision which held that Article 5(6) of the India-Singapore DTAA contemplates rendition of services by employees physically present within the country. The High Court explicitly stated that the concept of a virtual service permanent establishment does not find mention in the DTAA and that provisions of the DTAA must be interpreted strictly. The Tribunal concluded that since the DTAA does not contemplate VSPE and requires physical presence of employees, the CIT(A)'s finding that the assessee did not have a service PE in India was correct. Therefore, the grounds raised by the Revenue on both issues were dismissed.

The Tribunal dismissed the Revenue's appeals. On the issue of FTS, the Tribunal noted that the CIT(A) followed the Tribunal's own order in the assessee's own case for AY 2015-16. Regarding the VSPE, the Tribunal relied on a High Court decision which held that Article 5(6) of the India-Singapore DTAA contemplates rendition of services by employees physically present within the country. The High Court explicitly stated that the concept of a virtual service permanent establishment does not find mention in the DTAA and that provisions of the DTAA must be interpreted strictly. The Tribunal concluded that since the DTAA does not contemplate VSPE and requires physical presence of employees, the CIT(A)'s finding that the assessee did not have a service PE in India was correct. Therefore, the grounds raised by the Revenue on both issues were dismissed.

The Tribunal dismissed the Revenue's appeals. On the issue of FTS, the Tribunal noted that the CIT(A) followed the Tribunal's own order in the assessee's own case for AY 2015-16. Regarding the VSPE, the Tribunal relied on a High Court decision which held that Article 5(6) of the India-Singapore DTAA contemplates rendition of services by employees physically present within the country. The High Court explicitly stated that the concept of a virtual service permanent establishment does not find mention in the DTAA and that provisions of the DTAA must be interpreted strictly. The Tribunal concluded that since the DTAA does not contemplate VSPE and requires physical presence of employees, the CIT(A)'s finding that the assessee did not have a service PE in India was correct. Therefore, the grounds raised by the Revenue on both issues were dismissed.

The Tribunal held that a penalty under Section 271(1)(c) requires an element of tax sought to be evaded. Since no such element was present in this case, the penalty was deleted.

The Tribunal held that the CIT(A) failed to properly adjudicate the appeal. It ruled that TDS credit, once rectified and due, cannot be denied and directed the AO to allow the TDS credit and delete the interest levied u/s 234A and 234B.

The Tribunal quashed the reassessment proceedings, finding that the AO failed to record reasons for the assessee's failure to disclose material facts, violating the first proviso to Section 147. Additionally, the AO's reasons were based on factually incorrect assumptions.

The Tribunal held that the assumption of jurisdiction under Section 153C was flawed because the AO's satisfaction note did not explicitly state that the seized documents had a bearing on the determination of the assessee's total income. Therefore, the assessment was quashed.

The Tribunal held that the assessment order was passed without jurisdiction as it should have been framed under Section 153C, following the date of receipt of seized material by the jurisdictional AO. The appeal of the Revenue was dismissed.

The Tribunal held that the assessment order was bad in law because the Assessing Officer failed to issue a mandatory notice under Section 143(2) of the Act after the assessee filed a return in response to a notice under Section 148. This omission is not curable.

The Tribunal found that the NFAC's ex parte order was not justified as it failed to decide the issue on merits. Therefore, the appeal was restored to the NFAC for a fresh adjudication.

The Tribunal dismissed the Revenue's appeals. On the issue of FTS, the Tribunal noted that the CIT(A) followed the Tribunal's own order in the assessee's own case for AY 2015-16. Regarding the VSPE, the Tribunal relied on a High Court decision which held that Article 5(6) of the India-Singapore DTAA contemplates rendition of services by employees physically present within the country. The High Court explicitly stated that the concept of a virtual service permanent establishment does not find mention in the DTAA and that provisions of the DTAA must be interpreted strictly. The Tribunal concluded that since the DTAA does not contemplate VSPE and requires physical presence of employees, the CIT(A)'s finding that the assessee did not have a service PE in India was correct. Therefore, the grounds raised by the Revenue on both issues were dismissed.

The Tribunal held that an allotment in a residential unit, along with a purchase agreement and assignment, qualifies for the purpose of Section 54 deduction, even if the full payment was not made before construction completion. The disallowance made by the lower authorities was rejected.

The Tribunal considered the assessee's written request for withdrawal of the appeal and the absence of their representative at the hearing. The Tribunal also noted that the Revenue had no objection to the withdrawal. Therefore, the Tribunal allowed the assessee's request to withdraw the appeal. The appeal was accordingly dismissed as withdrawn. No specific findings were made on the merits of the case as the appeal was withdrawn by the assessee.

The Tribunal held that the amendment to Section 54F, which restricted the deduction to one residential house, was not applicable to the assessment year in question. Therefore, the assessee was eligible for deduction on both properties purchased.