ITAT Indore Judgments — January 2026

The Tribunal condoned the delay in filing appeals and, considering the circumstances including the Covid-19 period and lack of effective hearing, restored the matters to the Assessing Officer for de-novo consideration. No opinion was expressed on the merits of the additions.

The Tribunal found that the assessment was not made on merits by the lower authorities due to the assessee's non-compliance. While the CIT(A) had the discretion to set aside the order, the Tribunal decided to do so to ensure the real income is computed on merits.

The Tribunal held that the penalty levied under Section 271(1)(c) of the Income Tax Act, 1961, is not sustainable in law. The primary reasoning is that the show-cause notice for penalty did not specify the exact charge against the assessee, i.e., whether it was for concealment of income or for furnishing inaccurate particulars. The Tribunal relied on the decisions of the Karnataka High Court in CIT vs. Manjunatha Cotton Ginning Factory and CIT vs. SSA's Emerald Meadows, which were upheld by the Supreme Court. These judgments emphasize that notices issued under Section 274 must clearly specify the grounds on which penalty is sought to be imposed to satisfy the requirements of law and principles of natural justice. The Tribunal found that the initial burden lies on the revenue to establish concealment or furnishing of inaccurate particulars, and this burden was not discharged due to the vague nature of the notice. The Tribunal also noted that the jurisdictional High Court's decision in PCIT vs. Kulvant Singh Bhatia was relevant. Consequently, the Tribunal set aside the impugned order and allowed the appeal of the assessee, deleting the penalty.

The Tribunal condoned the delays in filing both the present appeal and the first appeal before the CIT(A), accepting the assessee's explanation of sufficient cause. The matter was subsequently remanded to the Assessing Officer for fresh adjudication.

The Tribunal rejected the assessee's initial prayer to quash the revision orders. Subsequently, the assessee sought to set aside the orders and remand them for fresh adjudication. However, the Tribunal found merit in the Revenue's objections against remand, considering the assessee's non-participation and the PCIT's identification of errors.

The tribunal noted that the assessee initially prayed for quashing of the revision orders but later modified the prayer to setting aside and remanding the matters for fresh adjudication. The Revenue objected to the remand, arguing that the assessee remained non-participative in the proceedings. The tribunal found merit in the Revenue's submissions and rejected the assessee's request for remand.

The Tribunal held that the lower authorities did not adjudicate the case on merits and that various documents, including sale deeds and a remand report, were not considered. Therefore, the case was set aside and remanded back to the CIT(A) for a fresh decision on merits.

The Tribunal held that the PCIT's order under Section 263 was not justified. It reasoned that the AO's failure to explicitly mention penalty proceedings or conduct further inquiries did not automatically render the assessment order erroneous and prejudicial to revenue.

The Tribunal held that the assessee is eligible for the rebate under Section 87A on tax on short-term capital gains (u/s 111A) and long-term capital gains (u/s 112) for AY 2024-25. However, the claim for rebate on tax from virtual digital assets was rejected.

The tribunal noted that the assessee initially prayed for quashing of the revision orders but later modified the prayer to setting aside and remanding the matters for fresh adjudication. The Revenue objected to the remand, arguing that the assessee remained non-participative in the proceedings. The tribunal found merit in the Revenue's submissions and rejected the assessee's request for remand.

The Tribunal held that the addition of Rs. 1,03,00,000 made by the AO and upheld by the CIT(A) was not sustainable and directed its deletion. The Tribunal found that the assessee had consistently explained that the deposits were made from cash withdrawals from their SBBJ bank account. The Tribunal noted that the entries for cash withdrawals were clearly reflected in the bank statements filed by the assessee, and the Revenue did not dispute these withdrawals. Specifically, the Tribunal observed that Rs. 1,90,00,000 was withdrawn in cash on April 7-8, 2015, out of which Rs. 94,00,000 was re-deposited on April 9-10, 2015. The Tribunal also noted that immediately before these withdrawals, the assessee had received Rs. 1,90,00,000 from their partnership firm, M/s Hindustan Sales Industrial Corporation, thus establishing a clear trail of money. The Tribunal disagreed with the AO's observation that no lump-sum withdrawals existed, finding it contrary to the record. The Tribunal cited the ITAT Bangalore's decision in Smt. Vinatha Madhusudan Reddy, which held that additions under Section 69A are not sustainable if cash deposits are out of earlier withdrawals and there is no material to show otherwise. The Tribunal concluded that the assessee had sufficiently explained the nature (cash re-deposit) and source (previous withdrawals from their own bank account) with documentary evidence, rendering the deeming fiction of Section 69A inapplicable. Therefore, the grounds raised by the assessee were allowed.

The Tribunal held that the impugned assessment order was not adjudicated on merits and was passed ex-parte. Therefore, the Tribunal set aside the order and remanded the case back to the Assessing Officer for a fresh assessment on merits.

The Tribunal found that the assessee failed to provide complete and readable documents to substantiate the source of cash deposits, and did not file a rejoinder to the remand report. Therefore, the case was remanded back to the CIT(A) for fresh adjudication.

The Tribunal observed that the assessee failed to appear on multiple hearing dates and did not provide any submissions, indicating a lack of interest in pursuing the appeal. Therefore, the appeal was dismissed for non-prosecution. However, the Tribunal also decided to adjudicate the grounds on merits.

The Tribunal noted that the appeals were migrated from a physical regime to a faceless regime. Due to this transition, the initial documents filed by the assessee might have been missed or not available to the new CIT(A). Therefore, the dismissal orders passed by the CIT(A), NFAC were considered improper.

The Tribunal noted that the appeals were migrated from a physical regime to a faceless regime. Due to this transition, the initial documents filed by the assessee might have been missed or not available to the new CIT(A). Therefore, the dismissal orders passed by the CIT(A), NFAC were considered improper.

The Tribunal noted that the appeals were migrated from a physical regime to a faceless regime. Due to this transition, the initial documents filed by the assessee might have been missed or not available to the new CIT(A). Therefore, the dismissal orders passed by the CIT(A), NFAC were considered improper.

The Tribunal noted that the appeals were migrated from a physical regime to a faceless regime. Due to this transition, the initial documents filed by the assessee might have been missed or not available to the new CIT(A). Therefore, the dismissal orders passed by the CIT(A), NFAC were considered improper.

The Tribunal held that non-supply of relied-upon material to the assessee violates the principles of natural justice, vitiating the assessments. For penalty appeals, the assessee was non-compliant to notices without sufficient cause.

The Tribunal held that non-supply of relied-upon material to the assessee violates the principles of natural justice, vitiating the assessments. For penalty appeals, the assessee was non-compliant to notices without sufficient cause.

The Tribunal held that non-supply of relied-upon material to the assessee violates the principles of natural justice, vitiating the assessments. For penalty appeals, the assessee was non-compliant to notices without sufficient cause.

For the quantum appeals (ITA Nos. 495 to 501/Ind/2025), the Tribunal held that the assessments were framed on the basis of material received under section 132A and collected during survey proceedings under section 133A. However, the Revenue failed to demonstrate that the complete relied-upon material was supplied to the assessee. The non-supply of such material violates the principles of natural justice and vitiates the assessments. Therefore, the impugned orders were set aside, and the matters were restored to the file of the AO for fresh adjudication. The AO was directed to supply all relied-upon material, afford an adequate opportunity of being heard, and frame assessments afresh. The assessee was directed to cooperate fully. These appeals were allowed for statistical purposes. For the penalty appeals (ITA Nos. 482 to 487/Ind/2025), the Tribunal held that the assessee failed to comply with notices issued by the AO under section 142(1) without sufficient cause. The assessee's submission that non-compliance was due to non-supply of material was not accepted, as the assessee could have at least filed a reply indicating their inability. The assessee also did not file a reply to the show-cause notice. Consequently, the Tribunal upheld the orders of the lower authorities, and these appeals were dismissed.

For the quantum appeals (ITA Nos. 495 to 501/Ind/2025), the Tribunal held that the assessments were framed on the basis of material received under section 132A and collected during survey proceedings under section 133A. However, the Revenue failed to demonstrate that the complete relied-upon material was supplied to the assessee. The non-supply of such material violates the principles of natural justice and vitiates the assessments. Therefore, the impugned orders were set aside, and the matters were restored to the file of the AO for fresh adjudication. The AO was directed to supply all relied-upon material, afford an adequate opportunity of being heard, and frame assessments afresh. The assessee was directed to cooperate fully. These appeals were allowed for statistical purposes. For the penalty appeals (ITA Nos. 482 to 487/Ind/2025), the Tribunal held that the assessee failed to comply with notices issued by the AO under section 142(1) without sufficient cause. The assessee's submission that non-compliance was due to non-supply of material was not accepted, as the assessee could have at least filed a reply indicating their inability. The assessee also did not file a reply to the show-cause notice. Consequently, the Tribunal upheld the orders of the lower authorities, and these appeals were dismissed.

For the quantum appeals (ITA Nos. 495 to 501/Ind/2025), the Tribunal held that the assessments were framed on the basis of material received under section 132A and collected during survey proceedings under section 133A. However, the Revenue failed to demonstrate that the complete relied-upon material was supplied to the assessee. The non-supply of such material violates the principles of natural justice and vitiates the assessments. Therefore, the impugned orders were set aside, and the matters were restored to the file of the AO for fresh adjudication. The AO was directed to supply all relied-upon material, afford an adequate opportunity of being heard, and frame assessments afresh. The assessee was directed to cooperate fully. These appeals were allowed for statistical purposes. For the penalty appeals (ITA Nos. 482 to 487/Ind/2025), the Tribunal held that the assessee failed to comply with notices issued by the AO under section 142(1) without sufficient cause. The assessee's submission that non-compliance was due to non-supply of material was not accepted, as the assessee could have at least filed a reply indicating their inability. The assessee also did not file a reply to the show-cause notice. Consequently, the Tribunal upheld the orders of the lower authorities, and these appeals were dismissed.

The Tribunal condoned the delay finding 'sufficient cause' and a justice-oriented approach. It was held that the CIT(A) did not provide a reasonable opportunity to the assessee, hence the matter was remanded for fresh adjudication on merits.

The Tribunal held that the disallowance of proportionate interest was unwarranted as the assessee had sufficient interest-free own funds exceeding the interest-free advances. Furthermore, the Tribunal allowed the second ground, deleting the disallowance of interest paid to the HUF, as Form 26AS supported the payment.

For the quantum appeals (ITA Nos. 495 to 501/Ind/2025), the Tribunal held that the assessments were framed on the basis of material received under section 132A and collected during survey proceedings under section 133A. However, the Revenue failed to demonstrate that the complete relied-upon material was supplied to the assessee. The non-supply of such material violates the principles of natural justice and vitiates the assessments. Therefore, the impugned orders were set aside, and the matters were restored to the file of the AO for fresh adjudication. The AO was directed to supply all relied-upon material, afford an adequate opportunity of being heard, and frame assessments afresh. The assessee was directed to cooperate fully. These appeals were allowed for statistical purposes. For the penalty appeals (ITA Nos. 482 to 487/Ind/2025), the Tribunal held that the assessee failed to comply with notices issued by the AO under section 142(1) without sufficient cause. The assessee's submission that non-compliance was due to non-supply of material was not accepted, as the assessee could have at least filed a reply indicating their inability. The assessee also did not file a reply to the show-cause notice. Consequently, the Tribunal upheld the orders of the lower authorities, and these appeals were dismissed.

For the quantum appeals (ITA Nos. 495 to 501/Ind/2025), the Tribunal held that the assessments were framed on the basis of material received under section 132A and collected during survey proceedings under section 133A. However, the Revenue failed to demonstrate that the complete relied-upon material was supplied to the assessee. The non-supply of such material violates the principles of natural justice and vitiates the assessments. Therefore, the impugned orders were set aside, and the matters were restored to the file of the AO for fresh adjudication. The AO was directed to supply all relied-upon material, afford an adequate opportunity of being heard, and frame assessments afresh. The assessee was directed to cooperate fully. These appeals were allowed for statistical purposes. For the penalty appeals (ITA Nos. 482 to 487/Ind/2025), the Tribunal held that the assessee failed to comply with notices issued by the AO under section 142(1) without sufficient cause. The assessee's submission that non-compliance was due to non-supply of material was not accepted, as the assessee could have at least filed a reply indicating their inability. The assessee also did not file a reply to the show-cause notice. Consequently, the Tribunal upheld the orders of the lower authorities, and these appeals were dismissed.

For the quantum appeals (ITA Nos. 495 to 501/Ind/2025), the Tribunal held that the assessments were framed on the basis of material received under section 132A and collected during survey proceedings under section 133A. However, the Revenue failed to demonstrate that the complete relied-upon material was supplied to the assessee. The non-supply of such material violates the principles of natural justice and vitiates the assessments. Therefore, the impugned orders were set aside, and the matters were restored to the file of the AO for fresh adjudication. The AO was directed to supply all relied-upon material, afford an adequate opportunity of being heard, and frame assessments afresh. The assessee was directed to cooperate fully. These appeals were allowed for statistical purposes. For the penalty appeals (ITA Nos. 482 to 487/Ind/2025), the Tribunal held that the assessee failed to comply with notices issued by the AO under section 142(1) without sufficient cause. The assessee's submission that non-compliance was due to non-supply of material was not accepted, as the assessee could have at least filed a reply indicating their inability. The assessee also did not file a reply to the show-cause notice. Consequently, the Tribunal upheld the orders of the lower authorities, and these appeals were dismissed.

For the quantum appeals (ITA Nos. 495 to 501/Ind/2025), the Tribunal held that the assessments were framed on the basis of material received under section 132A and collected during survey proceedings under section 133A. However, the Revenue failed to demonstrate that the complete relied-upon material was supplied to the assessee. The non-supply of such material violates the principles of natural justice and vitiates the assessments. Therefore, the impugned orders were set aside, and the matters were restored to the file of the AO for fresh adjudication. The AO was directed to supply all relied-upon material, afford an adequate opportunity of being heard, and frame assessments afresh. The assessee was directed to cooperate fully. These appeals were allowed for statistical purposes. For the penalty appeals (ITA Nos. 482 to 487/Ind/2025), the Tribunal held that the assessee failed to comply with notices issued by the AO under section 142(1) without sufficient cause. The assessee's submission that non-compliance was due to non-supply of material was not accepted, as the assessee could have at least filed a reply indicating their inability. The assessee also did not file a reply to the show-cause notice. Consequently, the Tribunal upheld the orders of the lower authorities, and these appeals were dismissed.

The Tribunal found shortcomings in the CIT(A)'s order and agreed that the addition made by the AO could not be deleted solely on the basis of the CIT(A)'s reasoning. However, the Tribunal also noted that the AO had relied on the statement of a third party without providing the assessee an opportunity to cross-examine him.

The Tribunal held that the appeals filed by the assessee were to be allowed. The reasoning was based on the fact that the CIT(A) had dismissed the appeals on technical grounds without a proper appreciation of the facts and submissions. The Tribunal noted that the assessee's grounds of appeal specifically challenged the dismissal for want of documents that were allegedly already submitted, and the invalidity of the reassessment proceedings. Since the revenue did not present any arguments or counter-contentions, and the assessee's primary grievance was the procedural dismissal by the CIT(A), the Tribunal found merit in the assessee's plea. The operative direction was to set aside the orders of the CIT(A) and remand the matters back to the CIT(A) for fresh adjudication on merits. The Tribunal explicitly left undecided any substantive issues related to the assessment itself, as the appeals were disposed of on procedural grounds.

The Tribunal upheld the CIT(A)'s order, agreeing that the agricultural land was situated outside the municipal limits at the time of sale and thus not a capital asset under section 2(14). The penalty appeal was also dismissed as the underlying addition was deleted.

The Tribunal held that the delay in filing the audit report is a procedural lapse and not a reason to deny exemption under Section 11/12. The matter was remanded back to the AO for fresh assessment considering the belatedly filed audit report.

The Tribunal held that penalty under section 271(1)(b) is not automatic and requires examination of reasonable cause. The Tribunal noted that the notice itself was defective and the assessee had contested the assessment order, indicating no wilful failure.

The Tribunal held that non-supply of relied-upon material to the assessee violates the principles of natural justice, vitiating the assessments. For penalty appeals, the assessee was non-compliant to notices without sufficient cause.

The Tribunal noted that the assessee's primary grievance in the quantum appeals was that the Assessing Officer (AO) had framed assessments under Section 144/143(3) without providing the assessee with the material relied upon. The assessee had made several attempts to obtain these documents from the AO, including an application dated 28.05.2025 and subsequent reminders. The judgment indicates that the AO had not provided the required documents to the assessee even at the time of the appeal. The Tribunal, in its order, has directed the AO to provide the necessary documents to the assessee. The operative part of the order states that the appeals are being remanded to the AO for fresh adjudication after providing the required documents to the assessee. The penalty appeals are also to be adjudicated afresh after the quantum assessment is completed.

The CIT(A) deleted the additions, holding that the assessee had discharged the onus under section 68, with identity, creditworthiness, and genuineness established by documentary evidence, including loan repayment. The Tribunal, however, felt that factual verification was required regarding the repayment of principal and interest, and TDS thereon.

The CIT(A) found that the land was situated outside the municipal limit of Bhopal at the time of sale, thus not a capital asset. The Tribunal upheld the CIT(A)'s order, agreeing that the land was rural agricultural land and not a capital asset. Consequently, the penalty imposed was also deemed unsustainable.

The Tribunal held that the disallowance of the deduction under section 80JJAA solely on account of the delayed filing of Form No. 10DA, which is a procedural requirement, is not justified. The substantive conditions for the deduction were met, and the form was available before the return processing, causing no prejudice to the revenue.

The Tribunal noted that the appeals were migrated from a physical regime to a faceless regime. Due to this transition, the initial documents filed by the assessee might have been missed or not available to the new CIT(A). Therefore, the dismissal orders passed by the CIT(A), NFAC were considered improper.

The Tribunal noted that the appeals were migrated from a physical regime to a faceless regime. Due to this transition, the initial documents filed by the assessee might have been missed or not available to the new CIT(A). Therefore, the dismissal orders passed by the CIT(A), NFAC were considered improper.

The Tribunal noted that the appeals were migrated from a physical regime to a faceless regime. Due to this transition, the initial documents filed by the assessee might have been missed or not available to the new CIT(A). Therefore, the dismissal orders passed by the CIT(A), NFAC were considered improper.

The Tribunal noted that the appeals were migrated from a physical regime to a faceless regime. Due to this transition, the initial documents filed by the assessee might have been missed or not available to the new CIT(A). Therefore, the dismissal orders passed by the CIT(A), NFAC were considered improper.

The Tribunal noted that the appeals were migrated from a physical regime to a faceless regime. Due to this transition, the initial documents filed by the assessee might have been missed or not available to the new CIT(A). Therefore, the dismissal orders passed by the CIT(A), NFAC were considered improper.

The Tribunal acknowledged that the new regime for registration under Section 12A, introduced by TOLA, has led to inadvertent errors in clause selection. Following precedents where similar technical mistakes were granted relief, the Tribunal decided to remand the matter back to the CIT(E) for fresh adjudication.

The Tribunal noted that the assessee had filed the requisite documents for the first appeal (Form No. 35, Grounds of Appeal, Statement of Facts, etc.) to the CIT(A), Indore, on 28.04.2014, under the then-prevailing physical mode. Subsequently, the first appeal proceedings were migrated to the Faceless System, and the CIT(A), NFAC passed the impugned orders. The Tribunal observed that due to this migration, the documents filed under the physical mode might not have been available to the NFAC, leading to the dismissal of appeals on the grounds of non-prosecution and non-filing of requisite documents. Consequently, the Tribunal found the impugned orders passed by the CIT(A), NFAC to be improper. The Tribunal set aside the impugned orders and remitted all the matters back to the file of the CIT(A), NFAC for adjudication afresh. The assessee was directed to avail fresh opportunities, re-file the required documents, and make a full representation without seeking unnecessary adjournments. The appeals were allowed for statistical purposes.

For the quantum appeals (ITA Nos. 495 to 501/Ind/2025), the Tribunal held that the assessments were framed on the basis of material received under section 132A and collected during survey proceedings under section 133A. However, the Revenue failed to demonstrate that the complete relied-upon material was supplied to the assessee. The non-supply of such material violates the principles of natural justice and vitiates the assessments. Therefore, the impugned orders were set aside, and the matters were restored to the file of the AO for fresh adjudication. The AO was directed to supply all relied-upon material, afford an adequate opportunity of being heard, and frame assessments afresh. The assessee was directed to cooperate fully. These appeals were allowed for statistical purposes. For the penalty appeals (ITA Nos. 482 to 487/Ind/2025), the Tribunal held that the assessee failed to comply with notices issued by the AO under section 142(1) without sufficient cause. The assessee's submission that non-compliance was due to non-supply of material was not accepted, as the assessee could have at least filed a reply indicating their inability. The assessee also did not file a reply to the show-cause notice. Consequently, the Tribunal upheld the orders of the lower authorities, and these appeals were dismissed.

The Tribunal condoned the delay of 84 days in filing the appeal, finding that the assessee had sufficient cause for the delay. The Tribunal relied on Section 253(5) of the Income-tax Act, 1961, which empowers the ITAT to admit an appeal after the prescribed time if there is a sufficient cause. It also cited the Supreme Court's decision in Collector, Land Acquisition Vs Mst. Katiji and others, emphasizing the preference for substantial justice over technical considerations. The Tribunal also noted that the CIT(A) had passed an ex-parte order without a reasoned adjudication, violating Section 250(6) of the Act. The assessee's ground of appeal regarding the non-speaking and ex-parte order of the CIT(A) was also considered. Consequently, the Tribunal decided to remand the matter back to the CIT(A) for fresh adjudication. The CIT(A) was directed to provide the assessee with an opportunity of hearing and pass an appropriate order, uninfluenced by the earlier order. The assessee was directed to be vigilant and ensure participation in hearings, with liberty to the CIT(A) to pass an order in accordance with law if the assessee sought unnecessary adjournments. The appeal was allowed for statistical purposes.

The Tribunal held that the assessee's selection of an incorrect clause in the application for registration under Section 12AB was a technical mistake due to confusion with the newly introduced provisions. The Tribunal noted that similar situations involving inadvertent selection of incorrect clauses had been dealt with pragmatically by other Benches of the ITAT. Following the decisions in Rambha Charitable Trust and North Eastern Social Research Centre, the Tribunal found merit in the assessee's submission that it was a technical error. Consequently, the Tribunal remanded both appeals to the Commissioner of Income-Tax (Exemption) for adjudication afresh. For ITA No. 887/Ind/2025, the CIT(E) was directed to grant final registration under the correct/applicable clause of Section 12A(1)(ac) read with Section 12AB, if the assessee is otherwise eligible. For ITA No. 890/Ind/2025, the matter of approval under Section 80G was also remanded to the CIT(E) for fresh adjudication, as it was consequential to the registration issue. The appeals were allowed for statistical purposes.