ITAT Jaipur Judgments — March 2024

The Tribunal observed that the delay was not deliberate and was due to a genuine mistake. Considering the larger interest of justice, the Tribunal decided to condone the delay in filing the appeal before the CIT(A). The CIT(A) was directed to adjudicate the issue on its merits.

The Tribunal held that the assessee deserves immunity from the levy of penalty under Section 273B of the Act. The penalty of Rs. 10,000/- was levied under Section 272A(1)(d) for non-compliance with the notice under Section 142(1) dated 03.12.2019. While the assessee had filed certain details online on 10.06.2019 and 02.07.2019, it was an admitted fact that he had not appeared on one occasion. The reason provided for non-appearance was the assessee's unawareness of the hearing date fixed by the notice dated 03.12.2019. Considering that the assessee is a taxi driver, works regularly for his livelihood, and is not well-educated, it was plausible that he failed to appear without any mens rea, especially given the technicalities of e-proceedings. The Tribunal found that the assessee had a reasonable cause for the failure. Therefore, the finding of the CIT(A) was set aside, and the impugned penalty was deleted. The operative direction was the deletion of the penalty.

The Tribunal acknowledged that the assessee, an E-mitra help desk agent, received cash from various persons for E-mitra portal services, such as IRCTC ticket purchases and other expenditures. The Tribunal observed that the paper book contained details demonstrating the utilization of cash deposits for such purposes, and bank statements confirmed that small cash amounts were deposited and immediately used for payments. While the Revenue authorities pointed to the lack of details regarding the persons providing cash, the Tribunal considered the age of the matter (almost 8 years old) and the fact that the source of income from similar activities in the subsequent Assessment Year 2017-18 was accepted by the AO. To resolve the dispute, the Tribunal sustained an addition of Rs. 50,000/- to account for the deficiency alleged by the Revenue authorities and deleted the remaining addition of Rs. 15,51,220/-. The Tribunal found that the discretion under Section 69 was not exercised judiciously by the lower authorities in confirming the entire addition. The ratio decidendi is that while maintaining records of cash providers is expected, in cases of long-standing transactions and accepted income from similar activities in subsequent years, a substantial part of the addition can be deleted, with a nominal amount retained to address the revenue's concerns about unverified sources.

The Tribunal noted that the CIT(A) passed an ex-parte order without discussing the merits of the case and without specific findings. The Tribunal restored the issue to the file of the CIT(A) for necessary adjudication.

The tribunal noted that the CIT(A) passed an ex-parte order dismissing the appeal as the assessee failed to make submissions or produce evidence. The tribunal decided to give the assessee one more opportunity to contest the case before the CIT(A). The appeal was restored to the CIT(A) for fresh adjudication with a cost of Rs. 2,000/- imposed on the assessee for lethargic action.

The Tribunal condoned the delay in filing the appeal due to the medical reasons submitted by the assessee. The Tribunal restored the appeal to the file of the CIT(A) for a fresh adjudication, giving the assessee one more opportunity to present their case. A cost of Rs. 2,000/- was imposed on the assessee for the delay.

The Tribunal confirmed the rejection of the books of account but directed the Assessing Officer to recompute the profit at an average NP rate of 2.01% based on the preceding three years' data, considering it would render justice to the assessee.

The Tribunal held that for completed and unabated assessment years, additions can only be made if incriminating material is found during a search. Since no such material was found for the Dharmada/charity amount, the addition made by the AO was illegal.

The Tribunal held that the assessee appeared to have lost interest in pursuing the appeal, as evidenced by their conduct. However, considering the prayer for one more opportunity, the appeal was restored to the file of the CIT(A) for fresh adjudication.

The Tribunal held that the disallowance of Section 80P deduction made under Section 143(1) was not permissible for AY 2018-19 as the relevant provision was amended later. For AY 2019-20, the Tribunal followed its decision for AY 2018-19.

The ITAT condoned the delay in filing the appeal, finding merit in the assessee's explanation. The Tribunal restored the appeal to the CIT(A) for fresh adjudication, granting the assessee one more opportunity to contest the case.

The Tribunal noted that the delay in filing the appeal before the CIT(A) was condoned by the CIT(A) in the past, but the CIT(A) dismissed the appeal on the ground of delay. The Tribunal decided to give the assessee one more chance to contest the case before the CIT(A) and restored the appeal to the file of the CIT(A) for fresh adjudication.

The Tribunal condoned the delay after considering the assessee's affidavit explaining the reasons. The Tribunal noted that the CIT(A) had passed an ex-parte order as the assessee did not file submissions or evidence. However, the Tribunal decided to restore the appeal to the CIT(A) for fresh adjudication, allowing the assessee one more opportunity to present their case.

The Tribunal condoned the delay in filing the appeals after noting merit in the assessee's applications and affidavits. The Tribunal restored the appeals to the file of the CIT(A) for fresh adjudication, granting the assessee one more opportunity to present their case. However, a cost of Rs. 2,000/- was imposed on the assessee for lethargic action.

The Tribunal noted that the assessee's explanation for the delay was not sufficient. It was observed that the assessee was negligent in following up with their counsel and tracking the appeal proceedings. While acknowledging the difficulty faced by the assessee, the Tribunal referred to various case laws regarding condonation of delay.

The Tribunal noted that the assessee had not filed submissions or evidence before the CIT(A). While the CIT(A) had confirmed the AO's action, the Tribunal decided to grant the assessee one more opportunity to contest the case before the CIT(A).

The Tribunal held that an assessment order passed against a deceased person, when the AO is aware of the death, is non-est in law and void ab-initio. The legal heirs were not brought on record, and no notice was issued to them, rendering the reassessment invalid.

The Tribunal held that the CIT(A) had dismissed the appeal ex-parte without deciding on merits. The assessee was granted one more opportunity to present their case before the CIT(A) for a fresh adjudication.

The Tribunal held that the PCIT's order under Section 263 was based on audit objections and lacked an independent view. It also noted that the issue had been consistently allowed in previous years and that reopening the case after a survey and reassessment was impermissible, citing the principle of finality in legal proceedings.

The Tribunal noted that the assessee was not given an adequate opportunity of being heard, leading to an ex-parte order. The Tribunal allowed the appeal and restored the matter to the file of the CIT(E) for fresh adjudication, with a direction to provide the assessee with adequate opportunity.

The Tribunal allowed the assessee's appeal, primarily on Ground No. 5. The Tribunal noted that a notice under section 148 was issued on October 9, 2014. The assessee contended that their Authorized Representative appeared on October 30, 2015, and filed a copy of the Income Tax Return (ITR), which should be considered as the return filed in response to the notice under section 148. The revenue contended that since no return was filed under section 148, no notice under section 143(2) was issued. The Tribunal found that the order sheet entry recorded the filing of the ITR. Relying on the Supreme Court's decision in ACIT vs. Hotel Blue Moon (321 ITR 362) and the Delhi High Court's decision in Pr. CIT vs. Shri Jai Shiv Shankar Traders P Ltd (ITA 519/2015), which held that the omission to issue a notice under section 143(2) is not a curable procedural irregularity and renders the assessment void, the Tribunal held that the failure to issue a notice under section 143(2) when the assessee effectively filed a return on October 30, 2015, was fatal to the reassessment order. Consequently, Ground No. 5 was allowed, and the assessment proceedings were quashed. As a result, other grounds raised by the assessee were rendered academic and not adjudicated.

The Tribunal held that the interest income earned from investments in a cooperative bank is not eligible for deduction under Section 80P(2)(a)(i) or 80P(2)(d) of the Income Tax Act. This is because the cooperative bank is excluded from the ambit of Section 80P by virtue of Section 80P(4), and the interest income is not considered operational income.

The Tribunal condoned the delay of 120 days in filing the appeal, citing the assessee's status as a villager with limited access to communication and the principles laid down in Collector, Land & Acquisition Vs. Mst. Katiji& Others. The Tribunal found merit in the assessee's contention that the same income cannot be taxed twice in the same assessment year and that demand cannot be raised twice. It noted that two separate orders were passed: one under section 143(3) dated 24.12.2018 and another under section 147 r.w.s. 144 r.ws. 144 B dated 24.03.2022, making identical disallowances. The Tribunal also acknowledged the assessee's claim of having placed additional evidence in the first round of appeal that was not considered by the AO. Consequently, the Tribunal set aside the assessment order and remanded the matter back to the Assessing Officer (AO) to examine the assessee's contentions, including the issue of dual assessment, and pass a fresh order after providing the assessee with a sufficient opportunity of being heard. The Tribunal clarified that this decision does not reflect on the merits of the dispute.

The Tribunal held that the assessee had provided sufficient documentary evidence to explain the difference in sales and to prove the genuineness of unsecured loans. The AO had failed to disprove the evidence provided by the assessee.

The Tribunal held that the PCIT erred in assuming jurisdiction under Section 263 for all three issues raised. Regarding Issue No. 1 (Section 14A disallowance), the Tribunal found that no new investments were made in the year under consideration, the investments were made from interest-free funds exceeding the investment amount, and no exempt income was received. Therefore, the NFAC had not committed any error in not making the disallowance, and the PCIT's order was set aside. For Issue No. 2 (interest on delayed TDS), the Tribunal held that the NFAC had taken a plausible view by allowing the interest expense, and in cases where two views are possible, the AO's view cannot be deemed erroneous. Thus, the PCIT's assumption of jurisdiction was incorrect. For Issue No. 3 (excess MAT credit), the Tribunal agreed with the assessee that such a mistake could have been rectified under Section 154 by the AO, and Section 263 jurisdiction was not warranted. The Tribunal set aside the PCIT's order on this issue as well. The operative direction was to set aside the PCIT's order and restore the NFAC's order.

The Tribunal held that the cash deposits were supported by cash sales duly recorded in the audited books of accounts. Relying on High Court judgments, the Tribunal concluded that cash sales, when properly recorded, cannot be treated as undisclosed income.

The Tribunal noted that the assessee's appeal before the CIT(A) was dismissed on the ground of non-admission due to non-payment of advance tax, as per section 249(4)(b). The assessee argued that no advance tax was payable as her income was below the maximum amount not chargeable to tax. The Tribunal also noted the assessee's submission that the AO's order was ex-parte and that the actual cash deposit was Rs. 1,63,000/- in a joint account, which was not appreciated by the lower authorities. Considering the interest of equity and justice, and that the lower authorities passed ex-parte orders, the Tribunal found it necessary to remand the matter back to the Assessing Officer. The AO is directed to examine the exact amount of cash deposit and decide the issue afresh after considering the assessee's submissions. The Tribunal clarified that this decision to restore the matter does not reflect on the merits of the dispute, which will be adjudicated independently by the AO. The appeal is allowed for statistical purposes.

The Tribunal held that the AO's method of estimating the cost of construction using reverse indexation was not in accordance with the law. Considering the absence of original construction records and the demolition of the property, the Tribunal accepted a valuation report as a guiding factor.