ITAT Delhi Judgments — September 2026

The Tribunal held that the applications for condonation of delay of 27 days in filing the appeals by the Revenue are allowed. The Tribunal found that the explanation for the delay did not indicate mala fides and that the Revenue had not gained anything by the delay. Regarding the substantive issue, the Tribunal observed that the CIT(A) had followed the ratio of the jurisdictional High Court in the case of Ojjus Medicare Pvt. Ltd. to hold the assessment order illegal. The Tribunal further noted that the mere pendency of an SLP against a High Court judgment has no consequence. Therefore, the grounds of appeal raised by the Revenue were considered devoid of merit and were rejected. Consequently, the appeals filed by the Revenue were dismissed.

The Tribunal held that the disallowance under Section 36(1)(v)(a) is attracted when the assessee fails to comply with the statute, citing the larger bench decision in Checkmate Services Pvt. Ltd. The Tribunal also rejected the argument that such disallowances cannot be made under Section 143(1) processing, referencing a jurisdictional High Court decision.

The Tribunal held that the Commissioner of Income Tax (Exemption) had rejected the applications under Section 12A and Section 80G vide ex parte orders due to non-compliance by the applicant. The applicant had specifically prayed for the restoration of the matter to the CIT(E). In view of the material facts and in the interest of justice, the Tribunal set aside the impugned orders dated June 5, 2026. The matters were restored to the file of the CIT(E) for a fresh decision in accordance with the law, after affording a fair opportunity of hearing to the assessee. The Tribunal did not decide the substantive merits of the applications.

The Tribunal allowed the appeals. For AY 2015-16, the Tribunal held that the notice u/s 148 dated 30.06.2022 was barred by limitation, referencing the Supreme Court's decision in Union of India vs. Rajeev Bansal, where the Revenue conceded that for AY 2015-16, all notices issued on or after 1st April 2021 would have to be dropped as they would not fall for completion during the period prescribed under TOLA. Consequently, grounds of appeal 1 to 4 concerning limitation and sanction were accepted, and the notice was set aside. Grounds 5 to 8 were left open. For AY 2016-17, the Tribunal found that the notice u/s 148 dated 30.06.2022 was issued beyond a period of three years. According to Section 151 of the Act, as interpreted by the Supreme Court in Rajeev Bansal, such a notice requires approval from a higher authority (PCCIT or CCIT). However, the approval was granted by the PCIT, which was deemed an inappropriate authority. Therefore, the notice was held to be invalid and set aside. Grounds of appeal 1 and 2 were accepted, and grounds 3 to 5 were left open. The operative direction for both appeals was to allow them.

The Tribunal allowed the appeals. For AY 2015-16, the Tribunal held that the notice u/s 148 dated 30.06.2022 was barred by limitation, referencing the Supreme Court's decision in Union of India vs. Rajeev Bansal, where the Revenue conceded that for AY 2015-16, all notices issued on or after 1st April 2021 would have to be dropped as they would not fall for completion during the period prescribed under TOLA. Consequently, grounds of appeal 1 to 4 concerning limitation and sanction were accepted, and the notice was set aside. Grounds 5 to 8 were left open. For AY 2016-17, the Tribunal found that the notice u/s 148 dated 30.06.2022 was issued beyond a period of three years. According to Section 151 of the Act, as interpreted by the Supreme Court in Rajeev Bansal, such a notice requires approval from a higher authority (PCCIT or CCIT). However, the approval was granted by the PCIT, which was deemed an inappropriate authority. Therefore, the notice was held to be invalid and set aside. Grounds of appeal 1 and 2 were accepted, and grounds 3 to 5 were left open. The operative direction for both appeals was to allow them.

The Tribunal held that the Commissioner of Income Tax (Exemption) had rejected the applications under Section 12A and Section 80G vide ex parte orders due to non-compliance by the applicant. The applicant had specifically prayed for the restoration of the matter to the CIT(E). In view of the material facts and in the interest of justice, the Tribunal set aside the impugned orders dated June 5, 2026. The matters were restored to the file of the CIT(E) for a fresh decision in accordance with the law, after affording a fair opportunity of hearing to the assessee. The Tribunal did not decide the substantive merits of the applications.

The Tribunal upheld the CIT(A)'s decision, finding that the assessee had provided sufficient documentary evidence during the appellate proceedings, including invoices, ledger accounts, VAT returns, bank statements, and proof of subsequent sales, which the AO could not refute in the remand report.

The Tribunal noted that the CIT(A) had dismissed the assessee's application for condonation of delay of 891 days and consequently dismissed the appeal. The AO had passed an ex parte assessment order because the assessee failed to respond to notices. The assessee's representative submitted that the assessee is about 61 years old, has limited education, is an agriculturist, and had sold immovable property. He claimed that no notice was received via registered post or other means, and he could not submit relevant documents to the AO. The assessee prayed for the matter to be restored to the file of the AO. Considering the material facts and in the interest of justice, the Tribunal set aside the impugned orders of the CIT(A) and the AO. The matter was restored to the file of the AO for a fresh decision in accordance with the law, after providing a fair opportunity of hearing to the assessee. The Tribunal allowed the appeal for statistical purposes.

The Tribunal, considering the assessee's submissions and the lack of complete evidence, decided that a lumpsum addition of Rs. 2 lakhs would meet the ends of justice. This decision is not to be treated as a precedent.

The Tribunal upheld the CIT(A)'s decision, finding that the assessee had provided sufficient documentary evidence during the appellate proceedings, including invoices, ledger accounts, VAT returns, bank statements, and proof of subsequent sales, which the AO could not refute in the remand report.

The Tribunal held that the reopening of assessment under Section 147 read with Section 148 of the Act is not valid. The reasoning was that when the sole basis for reopening, which culminated in corresponding additions, is deleted in the lower appellate proceedings before the CIT(A), such a reopening is not sustainable in law. The Tribunal relied on its "larger" bench decision in ITA No. 2650/Del/2024, Mahesh Kumar vs. ITO, decided on 06.08.2025, which settled the matter against the department. The Tribunal noted that the addition on account of unexplained investments in property, which was the sole reason for reopening, was deleted by the CIT(A) and this deletion was not challenged by the Revenue, thus attaining finality. Consequently, the impugned addition could not be sustained, and the reopening was quashed. All other pleadings on merits were rendered academic. The appeal was allowed.

The Tribunal held that given the nature of the liquor sales business, which predominantly involves cash transactions, the cash payments made to M/s City Wines were duly explained. Therefore, the disallowance under Section 40A(3) was not justified.

The Tribunal allowed the assessee's request to withdraw the appeal. Consequently, the appeal filed by the assessee was dismissed as withdrawn.

The Tribunal noted that the lower authorities failed to make a mandatory reference to the DVO under Section 50C(2) of the Act. Therefore, the issue was restored to the Assessing Officer for fresh adjudication.

The Tribunal allowed the appeal in part. Regarding the addition of Rs. 37,40,598/- claimed as deduction under Section 54F, the Tribunal found that the assessee had successfully claimed this deduction based on documentary evidence submitted to the AO and CIT(A). The reasons provided by the lower authorities for denial were unsatisfactory, based on assumptions, and failed to consider that similar deductions were allowed to the assessee's wife and father for the same property. The Tribunal held that the assessee was entitled to the deduction under Section 54F. The impugned order was set aside concerning this addition, and the ground raised by the assessee was allowed, deleting the addition. The judgment does not explicitly detail the findings on other grounds, such as the unexplained credit and cost of improvement, but the overall result indicates that these were not fully allowed to the assessee. The Tribunal noted that the AO had not discharged the onus of showing properties as residential houses and that the CIT(A) disposed of submissions mechanically. The Tribunal's ratio for allowing the Section 54F deduction is that the lower authorities failed to consider crucial evidence and submissions, including the allowance of similar deductions to co-owners, leading to an unjust and illegal denial of the exemption.

The Tribunal held that the assessee is entitled to interest under Section 244A from the first day of the assessment year. It reasoned that the entire assessment and appeal process is a continuous determination of correct income, and a claim allowed at any stage implies no tax was due on that portion. The delay in raising the claim does not necessarily mean a delay in proceedings attributable to the assessee for the purpose of excluding interest.

The Tribunal held that the assessee is entitled to interest under Section 244A from the first day of the assessment year. It reasoned that the entire assessment and appeal process is a continuous determination of correct income, and a claim allowed at any stage implies no tax was due on that portion. The delay in raising the claim does not necessarily mean a delay in proceedings attributable to the assessee for the purpose of excluding interest.

The Tribunal upheld the CIT(A)'s decision, stating that the assessment order was invalid and void ab initio due to the absence of a mandatory notice under section 143(2). The Tribunal relied on the Supreme Court's decision in ACIT vs. Hotel Blue Moon.

The Tribunal held that a subsequent decision from a higher forum (Checkmate Services Pvt. Ltd.) cannot be the sole basis for a rectification under section 154. Relying on Prakash Kohli vs ITO, the Tribunal quashed the rectification orders.

The Tribunal held that the notice issued under Section 153C was bad in law as it was issued after the cut-off date of April 1, 2021, as per the proviso to Section 153C(3). Consequently, the assessment and penalty were quashed.

The Tribunal held that the notice issued under Section 153C was bad in law as it was issued after the cut-off date of April 1, 2021, as per the proviso to Section 153C(3). Consequently, the assessment and penalty were quashed.

The Tribunal found some merit in the Revenue's stand regarding the assessee's onus to prove the reconciliation of deposits. However, considering the sale of agricultural land, the possibility of cash deposits representing sale price could not be denied. A lumpsum addition of Rs. 2.10 lakhs was deemed just and proper.

The Tribunal acknowledged the possibility of cash turnover in the assessee's business but found that the explanation for the entire deposit was not fully discharged. Therefore, a lumpsum addition of Rs. 3 lakhs was deemed just and proper, providing relief of Rs. 30,70,000/- to the assessee.

The Tribunal held that reassessment proceedings initiated against a deceased assessee without proper notification or legal representation are not sustainable in law. The Tribunal relied on the jurisdictional High Court's decision in Savita Kapila Vs. ACIT.

The Tribunal found that the lower authorities estimated a high GP of 30% without considering market comparables for the auto spare parts business. Therefore, the Tribunal reduced the GP estimation to 5%, stating it should not be treated as a precedent.

The Tribunal held that the belated filing of the return does not disentitle the assessee to the deduction, relying on the case law Chirakkal Services Co-op Bank Ltd. vs CIT. The assessee's grievance regarding the Section 80IA(4) deduction was accepted.

The ITAT found that while the assessee had not complied with CIT(A)'s notices, natural justice principles required another opportunity. Therefore, the matter was remanded back to the CIT(A) for fresh adjudication after providing the assessee with adequate opportunity.

The Tribunal held that the applications for condonation of delay of 27 days in filing the appeals by the Revenue are allowed. The Tribunal found that the explanation for the delay did not indicate mala fides and that the Revenue had not gained anything by the delay. Regarding the substantive issue, the Tribunal observed that the CIT(A) had followed the ratio of the jurisdictional High Court in the case of Ojjus Medicare Pvt. Ltd. to hold the assessment order illegal. The Tribunal further noted that the mere pendency of an SLP against a High Court judgment has no consequence. Therefore, the grounds of appeal raised by the Revenue were considered devoid of merit and were rejected. Consequently, the appeals filed by the Revenue were dismissed.

The Tribunal noted that the tax effect in the appeal was below the minimum threshold prescribed by CBDT Circular No. 9/2024. The Departmental Representative conceded that this circular applied to pending appeals.

The Tribunal noted that the assessee took no steps to rectify the defects in the appeal. Consequently, without any record or representation from the assessee, the Tribunal was constrained to dismiss the appeal as defective.

The Tribunal held that offshore supply profits are not taxable in India if property and title pass outside India, and payments are received outside India. It also held that reimbursements of expatriate salary costs to a related entity do not constitute taxable income in the hands of the assessee.

The Tribunal held that the order of the PCIT was not sustainable. It relied on its previous decision which distinguished the High Court ruling cited by the Revenue, affirming that interest under Section 28 of the Land Acquisition Act is part of enhanced compensation and potentially exempt.

The Tribunal held that offshore supply profits are not taxable in India if property and title pass outside India, and payments are received outside India. It also held that reimbursements of expatriate salary costs to a related entity do not constitute taxable income in the hands of the assessee.

The Tribunal held that the approval for initiating reassessment proceedings was valid, distinguishing it from other High Court rulings. Crucially, it found that the assessee had no DAPE in India, making the attribution of profits and related grounds academic.

The Tribunal condoned the 6-day delay in filing the appeal before the CIT(A). It set aside the orders of the AO and CIT(A) and restored the matter to the AO for a fresh decision after providing a fair opportunity of hearing to the assessee.

The Tribunal quashed the assessment order as being without jurisdiction. The Tribunal noted the assessee's argument that the satisfaction for initiating proceedings under Section 153C was recorded on 11.05.2022, which falls within AY 2023-24. As per the first proviso to Section 153C(1), the date of search is considered the date of satisfaction. Consequently, the relevant block period for initiating proceedings under Section 153C would include AY 2017-18 to 2022-23. Since AY 2021-22 falls within this period, the assessment should have been made under Section 153C. The Tribunal found that the assessment was made under Section 143(3), which it deemed to be without jurisdiction. Relying on the Supreme Court judgment in Jasjit Singh and a Co-ordinate Bench decision in Asha Gupta Vs. DCIT, where similar facts led to the quashing of reassessment proceedings, the Tribunal allowed the appeal. No issue was expressly left undecided.

The Tribunal held that the interest income on enhanced compensation under the Land Acquisition Act, 1894, is not taxable, even after statutory amendments. The action of the lower authorities in taxing this interest income was reversed.

The Tribunal held that offshore supply profits are not taxable in India if property and title pass outside India, and payments are received outside India. It also held that reimbursements of expatriate salary costs to a related entity do not constitute taxable income in the hands of the assessee.

The Tribunal decided that the cash deposits totaling ₹2,47,91,057 were sufficiently explained. The assessee, engaged in the retail of pharmaceuticals and medicines, had furnished complete financials, VAT returns, and sample invoices. The Tribunal found that neither the Assessing Officer nor the CIT(A) identified any defects in these documents, and crucially, the lower authorities did not invoke Section 145 to reject the books of account. Therefore, the Tribunal held that the books of account must be accepted as they are. The Tribunal concluded that the cash deposits were directly correlatable with the cash sales made during the demonetization period and that the lower authorities erred in treating the documents as self-serving. The addition of ₹2,47,91,057 was deleted, and this ground of appeal was allowed. Regarding the cash withdrawals, personal savings, and family member contributions totaling ₹83,69,770, the Tribunal found that the assessee was able to prove these amounts with supporting documents, including bank accounts and evidence of cash availability. The Tribunal noted that the Assessing Officer's remand report did not negate the evidence, and the CIT(A) had simply rejected the explanation without cogent reasons. The Tribunal accepted the assessee's explanation and evidence as sufficient to prove the claim, and the addition of ₹83,69,770 was deleted. The appeal of the assessee was allowed in full.

The Tribunal held that offshore supply profits are not taxable in India if property and title pass outside India, and payments are received outside India. It also held that reimbursements of expatriate salary costs to a related entity do not constitute taxable income in the hands of the assessee.

The Tribunal held that the assessee is eligible for the full exemption of leave encashment as the amount claimed is below the revised limit of Rs. 25,00,000 prescribed by the CBDT. The AO is directed to allow the assessee's claim.

The Tribunal held that the Indian entity did not have the authority to habitually negotiate and enter into contracts on behalf of the assessee. Therefore, it did not constitute a DAPE under the India-Switzerland DTAA.

The Tribunal decided to allow a lumpsum disallowance of 3% of the alleged bogus purchases as a gross profit. This disallowance is not to be treated as a precedent.

The Tribunal decided to allow a lumpsum disallowance of 3% of the alleged bogus purchases/sales. This disallowance is to be treated as just and proper and not as a precedent.

The Tribunal decided to allow a lumpsum disallowance of 3% of the alleged bogus purchases as a gross profit. This disallowance is not to be treated as a precedent.

The Tribunal held that the date of search for the assessee is 05.04.2022, which falls in AY 2023-24. Therefore, the block period should be reckoned from AY 2023-24, making AYs 2012-13 and 2013-14 fall outside the block period.

The Tribunal held that the date of search for the assessee is 05.04.2022, which falls in AY 2023-24. Therefore, the block period should be reckoned from AY 2023-24, making AYs 2012-13 and 2013-14 fall outside the block period.

The Tribunal held that disallowance under Section 40(a)(i) cannot be made for short deduction of TDS; the appropriate course of action is to invoke Section 201. Therefore, the PCIT's direction for disallowance was not justified.

The Tribunal held that the FAO could not have assumed jurisdiction to frame the reassessment on March 15, 2022, as the relevant scheme was notified only on March 29, 2022. Therefore, the reassessment proceedings were quashed.

The Tribunal held that the assessee's cash deposits were explainable from business proceeds, but the assessee was not eligible for the presumptive tax scheme under Section 44AD due to turnover exceeding the limit. An ad-hoc addition of Rs. 3,00,000 was made as business income, and the addition on account of unaccounted sales was deleted.