ITAT Indore Judgments — October 2025

The Tribunal condoned the delay in filing the appeals, noting that the Revenue's Senior Departmental Representative fairly agreed to the assessee's prayer. The Tribunal acknowledged the assessee's willingness to file Form No. 26A and avail the benefit of the first proviso to Section 201(1) and the first proviso to Section 201(1A) of the Income-tax Act, 1961. The assessee had explained that the delay in submissions before the CIT(A) was due to the time taken to receive requisite forms from its head office. In the interest of justice, the Tribunal decided to give the assessee one more opportunity. Therefore, the matters were remitted back to the file of the CIT(A) for adjudication afresh. The assessee was directed to make full representation before the CIT(A) without seeking unnecessary adjournments. The appeals were allowed for statistical purposes.

The Tribunal held that the credit loan entry of Rs. 87,20,000 and the interest of Rs. 3,53,160 cannot be added to the assessee's income. The Tribunal relied on previous decisions which held that M/s Jay-Jyoti (India) Pvt. Ltd. (formerly M/s Jay Ganga Exim India Pvt. Ltd.) is not a paper or shell company.

The Tribunal noted that the CIT(A) sent hearing notices via email, even though the assessee had specifically indicated 'No' to email communication in Form No. 35. This procedural lapse by the CIT(A) is the primary ground for the assessee's appeal.

The Tribunal noted that the assessee had specifically indicated 'No' to receiving notices via email in Form No. 35. The appeals were decided based on this procedural irregularity.

The Tribunal addressed the grounds raised. Grounds 1 and 2, challenging the validity and legality of the orders, were not pressed by the assessee and were dismissed. Regarding Ground No. 3, concerning the addition of Rs. 5,42,75,671/- on account of 'Reserve & Surplus of Mess', the judgment does not explicitly state the Tribunal's finding or reasoning on this specific ground. It appears to have been omitted from the provided text. However, regarding Ground No. 4, the Tribunal held that the hostel/mess facility provided to students is an activity incidental to imparting education, citing the Supreme Court decision in New Noble Educational Society. Therefore, the provisions of Section 11(4)/(4A) and CBDT Circular Para 3 were not applicable. The Tribunal accepted the assessee's claim for 15% exemption on the basis of gross receipts from hostel/mess activity, following the decision in Artificial Limbs Manufacturing Corporation of India. Consequently, the addition of Rs. 20,21,992/- was directed to be deleted. Ground No. 5, a general ground, was dismissed as not pressed. The appeal was allowed in terms of the decision on Ground No. 4.

The Tribunal held that the assessee failed to provide a satisfactory explanation for the inordinate delay in filing the first appeal. Therefore, the CIT(A)'s order dismissing the appeal as time-barred was upheld.

The Tribunal dismissed the assessee's appeal, upholding the CIT(A)'s order. Regarding the delay in filing the first appeal, the Tribunal found that the assessee failed to provide a satisfactory and bonafide explanation for the 560-day delay. The Tribunal noted inconsistencies in the dates provided by the assessee regarding receipt of the penalty order and his presence on board a ship, as evidenced by the Continuous Discharge Certificate (CDC). The Tribunal concurred with the CIT(A)'s finding that no sufficient cause was shown for the delay and that the appeal was time-barred. The Tribunal also observed that the assessee had "twisted the facts" and was therefore not entitled to any relief. Consequently, the Tribunal upheld the "impugned order" which dismissed the first appeal on grounds of limitation. As the facts and circumstances for AY 2018-19 were similar, the appeal for that year was also dismissed on the same grounds. The Tribunal did not decide on the merits of the penalty under Section 270A, as the appeal was dismissed on the preliminary issue of limitation.

The Tribunal held that the research undertaken by the assessee satisfied the definition of 'scientific research related to business' as prescribed in section 43(4)(iii) of the Act. The Tribunal rejected the AO's reasoning that scientific research was not the assessee's business. Regarding the alternative claim, the Tribunal agreed in principle that the assessee is entitled to a 100% deduction of revenue expenses under section 35(1)(i) and appropriate depreciation under section 32(1) for capital expenditure. However, since complete details of expenses were not examined by the AO, the matter was referred back to the AO for factual examination of documents and evidences to allow the deductions. The grounds related to the withdrawal of the section 35(2AB) claim and the consequential disallowances were dismissed as non-pressed. The appeal was allowed for statistical purposes.

The Tribunal set aside the CIT(A)'s order, directing the Assessing Officer to delete the addition after the assessee provides an undertaking regarding carry-forward of losses. This was done to secure the ends of justice due to losses in both years.