ITAT Hyderabad Judgments — February 2026

The Tribunal held that since the assessee did not receive any consideration for the sale of the property, no income accrued to her. The capital gains should have been assessed in the hands of the brothers who actually received the sale consideration. Relying on judicial precedents, the Tribunal emphasized the concept of 'real income' for taxation.

The Tribunal condoned the delay of 200 days, subject to a cost of Rs. 5000/-, and set aside the impugned order of the CIT(A). The matter was remanded to the Assessing Officer for re-adjudication after verifying the additional evidence submitted by the assessee.

The Tribunal condoned the delay of 8 days in filing the appeal. Grounds 1, 2, 4, 5, and 6 were allowed in favor of the assessee, meaning the addition on account of interest income earned on fixed deposits and rental income was eligible to be set off against maintenance expenses. Ground 8, concerning the non-grant of credit for self-assessment tax, was also decided in favor of the assessee. The Assessing Officer was directed to verify and allow the credit for self-assessed tax.

The Tribunal held that the validity of assumption of jurisdiction for reassessment must be judged based on the material available with the AO at the time of issuing the notice under Section 148, not on the final assessed income. The substantial cash withdrawals constituted tangible material indicating potential escapement of income exceeding the threshold of Rs. 50 lakhs, thus justifying the issuance of the notice beyond three years as per Section 149(1)(b).

The Tribunal held that the assessee society had filed its applications within the prescribed time limit as per Section 12A(1)(ac)(iii) and Section 80G(5)(ix) of the Income-tax Act. The CIT(Exemptions) had wrongly dismissed the applications by overlooking the commencement date of activities.

The Tribunal held that the disallowance of the loss was made without basis and on conjectures. The transactions were genuine, conducted on a recognized stock exchange at prevailing market prices, and supported by documentary evidence. Even if the assessee's actions were not prudent, it did not justify disallowing the actual loss incurred.

The Tribunal held that the notice issued under section 148 of the Act dated 06/04/2022 was beyond the limitation period prescribed under the old regime of section 149(1) and consequently, the assessment order passed by the AO was bad in law and liable to be quashed. The Tribunal followed the decision of the Hon'ble High Court of Telangana in the case of Cyberabad Citizens Health Services Private Limited and its own previous order in the case of Peda Subbarao Unnam.

The Tribunal held that the notice issued under Section 148 of the Act was invalid because the AO considered non-existing or incorrect information to conclude that the escaped income exceeded Rs. 50 lakhs, which was a prerequisite for reopening assessment beyond three years. The AO should have verified the bank account statement before reopening.

The Tribunal found that the reopening of assessment was invalid as it was initiated beyond four years from the end of the assessment year and was based on a reappreciation of existing facts, akin to a change of opinion, without any failure on the part of the assessee to disclose material facts. Consequently, the reassessment order was quashed.

The Tribunal held that the applications were filed within the prescribed time limit. The commencement of activities was stated as 28.03.2024, and the application was filed on 22.09.2024, which is within six months. The prior provisional registration period also provided a deadline of 30.09.2024, making the filing timely.

The Tribunal held that the property was owned and sold by the assessee's spouse, and the sale consideration was deposited in a joint account. Therefore, imposing a penalty on the assessee for the mode of receipt of sale consideration was incorrect. Furthermore, the Assessing Officer (AO) had not recorded satisfaction for initiating penalty proceedings under Section 271D in the assessment order, which is a mandatory requirement as per Supreme Court judgments.

The Tribunal found that the notice under Section 153C was issued more than 10 months after the completion of the assessment of the searched person, exceeding the permissible time limit. Consequently, the notice and the subsequent assessment order were deemed invalid and void ab initio.

The Tribunal held that the notice issued under section 153C was beyond the limitation period, as there was a significant gap (over 10 months) between the completion of the assessment of the searched person and the issuance of the notice to the assessee. Relying on Supreme Court and High Court judgments, the Tribunal found the notice and subsequent assessment order to be invalid.

The Tribunal held that the assessment orders passed by the AO were barred by limitation as per Section 153B of the Income Tax Act, 1961. The AO failed to complete the assessment within the prescribed time limits following the search operation and the issuance of notice under Section 153C. The contention regarding extended time limits under Section 144C and its provisos was also rejected.

The Tribunal noted that the assessee failed to provide documentary evidence to support its claim that it was a cooperative society eligible for deduction under section 80P(2). Furthermore, the assessee did not produce any material to show it maintained audited regular books of account. The Tribunal also observed that the appeal was filed beyond the limitation period without sufficient cause.

The Tribunal held that the assessee's arguments regarding the property being HUF property were not tenable. The delay in filing the appeal was not sufficiently explained and was therefore not condoned, leading to the dismissal of the appeals. The AO rightly assessed the capital gains in the hands of the assessee.

The Tribunal held that the assessee's delay in filing the appeal was not sufficiently explained and upheld the CIT(A)'s decision to dismiss the appeal on the ground of limitation. Regarding the merits, the Tribunal found that the assessee had sold her share of the property in her individual capacity and was not entitled to claim it as HUF property. Therefore, the capital gain was assessable in her hands. The penalty for concealment of income was also upheld.

The Tribunal held that the reopening of assessment after 4 years was invalid because the assessee had not failed to disclose fully and truly all material facts necessary for the assessment. Furthermore, the Tribunal found that the addition was based on the statement of Shri Rajendra Jain without providing the assessee an opportunity to cross-examine him, which violates the principles of natural justice. Consequently, the addition was not sustainable on merits.

The Tribunal held that the addition related to cash deposits during demonetization, which was claimed to be from petrol sales, was not justified as the AO ignored the assessee's records, including the Form 'C' and stock statements. The addition concerning sundry creditors was remanded to the AO for proper verification, as the explanation that it was a book entry transfer from capital was not presented earlier.

The Tribunal held that loose sheets and random notings without corroborative evidence lack evidentiary value, and the AO failed to establish the genuineness of the alleged bogus expenses or unaccounted money. It also found that the conditions for invoking Section 69A were not met as ownership of unexplained valuable articles or money was not proven.

The Tribunal held that the final assessment order was passed beyond the time limit prescribed under section 153B of the Act. The contention that the extended timelines under section 144C were applicable was dismissed as those provisions relate to references made to the Transfer Pricing Officer, which was not the scenario in this case.

The Tribunal admitted additional evidence in the assessee's appeal concerning unexplained cash credits and remanded the issue to the Assessing Officer for verification. In the revenue's appeal, the addition for kitchen consumables was deleted, and the disallowance of professional charges was deleted. The disallowance of job work expenses was also deleted.

The Tribunal held that the penalty was unsustainable on merits as the revenue failed to discharge its burden of proving the violation of Section 269ST. The seized excel sheets did not provide sufficient evidence to ascertain individual transactions exceeding Rs. 2 lakhs, and mere admission of additional income was not conclusive for penalty proceedings. The Tribunal also found that the penalty order was time-barred.

The Tribunal held that the penalty order was time-barred and that the revenue had failed to provide sufficient evidence to prove the violation of Section 269ST. Consequently, the penalty was deemed unsustainable.

The Tribunal examined the grounds of appeal, which primarily contested the confirmation of penalty by the CIT(A). Key issues included the validity of the penalty notice, whether admissions during search proceedings constituted misreporting, the difference between returned and assessed income, and the correctness of the penalty computation. The appeals were consolidated due to identical issues.

The Tribunal held that the assessment orders were passed beyond the limitation period prescribed under Section 153B of the Income Tax Act, 1961. The AO's argument regarding extended time limits due to being an 'eligible assessee' was rejected as it only applies in cases of reference to the TPO, which was not the scenario here.

The Tribunal held that the notice under section 148, dated 30/07/2022, was issued beyond the time limit prescribed by the pre-amended section 149(1)(b) of the Act. The Tribunal found that the fifth and sixth provisos of the amended section 149 could not be applied to extend the limitation period for a notice already barred by the first proviso. Consequently, the reassessment order was quashed for invalid assumption of jurisdiction.

The Tribunal held that the assessment orders were passed beyond the time limit prescribed under Section 153B of the Income Tax Act, 1961. The extended time limit provisions, as argued by the Revenue, were found not applicable in this case, particularly concerning non-resident assessments.

The Tribunal held that the penalty order was barred by limitation. It was observed that the penalty proceedings were initiated on 25/05/2023 when the AO sent a reference to the JCIT. Six months from the end of May 2023 would be 30/11/2023, but the order was passed on 27/09/2024, which is beyond the statutory time limit. Furthermore, the Tribunal found that the evidence (excel sheets) was not specific enough to prove a violation of Section 269ST for individual transactions exceeding Rs. 2 lakhs.

The Tribunal held that loose sheets and random notings, without corroborative evidence, lack evidentiary value. The AO failed to establish the ownership of unaccounted cash or to correlate the entries with the assessee's books. Therefore, the conditions for invoking Section 69A of the Act were not met.

The tribunal admitted additional evidence in the assessee's appeal concerning unexplained cash credits and remanded the issue to the AO for verification. The revenue's appeal concerning kitchen consumables and professional charges was dismissed, while the ground regarding job work expenses was upheld.

The Tribunal held that the penalty order passed by the AO was barred by limitation as per Section 275(1)(c) of the Act. The Tribunal also found that the evidence in the excel sheet was aggregated and did not clearly demonstrate violation of Section 269ST for individual transactions. Therefore, the penalty was not sustainable on merits.

The tribunal's decision is not detailed in this excerpt. The text serves as an introduction to the appeal proceedings.

The Tribunal noted that while the assessee had a history of filing returns and deriving income from various sources, he failed to provide irrefutable evidence to substantiate the availability of cash in hand on the dates of deposit. Therefore, the Tribunal, through estimation, sustained the addition to the extent of Rs.2,65,375.

The Tribunal held that the penalty related to the addition of Rs. 1,86,32,023/- concerning long-term capital gains (LTCG) on sale of securities is not sustainable because the High Court admitted the assessee's appeal on substantial questions of law, making the issue debatable. However, the penalty related to the addition of Rs. 31,29,215/- from the sale of jewellery and Rs. 61 lakhs from unsecured loans was upheld.

The Tribunal held that the assessee had sufficient cash in hand as of November 8, 2016, which was evidenced by the cash book and accounted for the deposits made after November 9, 2016. The Tribunal found that the AO and CIT(A) incorrectly presumed that the assessee received cash from sundry debtors after November 8, 2016, and disallowed the source without considering the available evidence.

The Tribunal held that the AO erred in assessing gross receipts without allowing deductions for expenditure, especially when exemption u/s 11 was denied. The intimation suffered from a mistake apparent on record. The CIT(A) also erred in upholding the AO's order without considering the relevant facts.

The Tribunal held that the AO erred in assessing gross receipts as income without allowing deductions for expenditure when exemption under Section 11 was denied. The appeals were restored to the AO for assessment based on commercial principles.

The Tribunal acknowledged evidence of suppressed turnover but found the estimations by the Assessing Officer and CIT(A) to be arbitrary. The Tribunal directed a reasonable estimation of suppressed turnover at 25% and net profit at 15%, considering the business's seasonal nature and the parties' arguments.

The Tribunal acknowledged that there was evidence of suppressed turnover and that estimation was permissible. However, they found the estimations by both the Assessing Officer (59.68%) and CIT(A) (50%) to be ad-hoc and lacking sound basis. Therefore, they directed a revised estimation of suppressed turnover at 25%. For net profit, considering the assessee's declared profit of 12% and CIT(A)'s estimation of 20%, the Tribunal directed an estimation of 15%.

The Tribunal noted that the delay in filing Form 10 was condoned by the CIT(Exemptions) and that the donor details were not filed before the AO due to justifiable reasons, and the CIT(A) failed to consider the submitted donor details. Therefore, the matter was restored to the AO for readjudication.

The Tribunal held that if exemption u/s 11 is denied, income should be assessed on commercial principles, considering profit or loss. The AO erred in assessing gross receipts without allowing deductions for expenditure, as this was a mistake apparent from the record.

The Assessing Officer made an addition of Rs. 40 lakhs as unexplained cash credit. The CIT(A) upheld this addition. However, the Tribunal noted that the seized documents were not found with the assessee, not confronted to him, and no opportunity for cross-examination was provided, violating principles of natural justice.

The demolition was part of the sale transaction and not an independent event. The cost of the demolished structure is directly linked to the transfer consideration and is deductible under Section 48. The extinguishment of rights in the building constitutes a transfer. The CIT(A)'s denial of the indexed cost was upheld by the AO and Pr. CIT based on technical grounds, but the Tribunal found contradictions in the CIT(A)'s findings.

The Tribunal held that while there was evidence of suppressed turnover, the estimations by the Assessing Officer and CIT(A) were arbitrary. A reasonable estimation of suppressed turnover was necessary. The Tribunal directed the Assessing Officer to estimate 25% of the turnover quantified by the AO as suppressed turnover.

The Tribunal noted that the appeal was filed with a delay of 147 days, which was condoned due to the accountant's medical emergency. Regarding the merits, the Tribunal found substance in the assessee's claim that the investment was sourced from its bank account. However, as the assessee failed to fully substantiate this claim before the lower authorities, the matter was set aside to the AO for readjudication.

The Tribunal observed that the assessee's audited profit of 2.2% on sales of Rs. 7.56 crores could not be summarily discarded. However, the AO's rejection of books of account was also not entirely without merit. The Tribunal found substance in the assessee's contention that cash deposits were from regular business transactions.

The Tribunal allowed the appeal concerning the addition made under Section 69A for cash deposits, finding that the assessee's sales proceeds from the liquor business could explain the source of these deposits. However, the appeal was dismissed regarding the disallowance of the Section 80C deduction due to the assessee's failure to provide supporting evidence.

The Tribunal acknowledged evidence of suppressed receipts but found the estimations by the Assessing Officer and CIT(A) to be arbitrary. The Tribunal directed the Assessing Officer to estimate 25% of the quantified turnover as suppressed turnover and to estimate net profit at 15% on the suppressed turnover, averaging the assessee's declared profit and the CIT(A)'s estimation.

The Tribunal held that the reassessment notices issued under Section 148 were bad in law and void ab initio. This was primarily because the Assessing Officer failed to fulfill the mandatory conditions prescribed under Section 149(1)(b) for issuing notice beyond three years and did not obtain proper approval under Section 151, as the sanction was granted mechanically. Furthermore, for AY 2019-20, a second notice under Section 148 was issued without adhering to the procedure laid down in Section 148A after the first notice was dropped.