ITAT Jaipur Judgments — May 2025

The Tribunal held that registration under the RPT Act, 1959 is not mandatory for obtaining registration under the Income Tax Act. It also found that the assessee's activities were genuine based on the evidence and the Hon'ble Apex Court's decision in the Ananda Social & Educational Trust case.

The Tribunal held that the CIT(A) passed an ex-parte order without providing adequate opportunity for being heard to the assessee. The Tribunal restored the matter to the CIT(A) for fresh adjudication, considering all documents and providing one more opportunity of hearing to the assessee, while cautioning against frivolous adjournments.

The Tribunal held that the Assessing Officer was not justified in re-opening the assessment u/s 147 as the assessee had reflected both the income and expenses in her return. The AO should have considered the expenses and recalculated the total income.

The Tribunal noted that the assessee was deprived of a personal hearing by the CIT(A) despite a request. Considering the principles of natural justice, the Tribunal restored the matter to the CIT(A) for a fresh decision after providing an opportunity for a hearing.

The Tribunal condoned the 31-day delay, finding sufficient cause. It remanded the matter back to the CIT(E) for a fresh adjudication of the Section 80G application, instructing the assessee to submit all necessary documents and cooperate. The appeal was allowed for statistical purposes, with the Tribunal clarifying that the remand does not reflect on the merits of the dispute.

The Tribunal held that the income offered for tax was business income and not unexplained investment or money under Section 69/69A. Therefore, taxing it under Section 115BBE was not justified. The additions made by the AO and confirmed by the CIT(A) were set aside.

The assessee had opted to settle the dispute under the Vivad Se Vishwas Scheme 2024, which was accepted by the Department, and the tax was deposited. Therefore, the Tribunal allowed the withdrawal of the appeals.

The Tribunal held that the matter needs to be remanded to the Assessing Officer. The AO is directed to verify the transactions related to commission payments and discount expenses by examining ledger accounts and summoning relevant parties, providing an opportunity of being heard to the assessee.

The Tribunal held that the reasons for rejection cited by the CIT(E) were curable in nature. The Tribunal noted that the assessee is a long-standing charitable trust and that the defects pointed out could be rectified. Therefore, the Tribunal restored the matter to the file of the CIT(E) for fresh adjudication with an opportunity to the assessee to present its case.

The Tribunal held that the assessee's registration under Section 12AA of the Act was evident from various documents, including the 80G approval and the AO's own order for AY 2011-12. The Tribunal also considered the TDS penalty as a fee, not a penalty, and thus eligible for application of income.

The Tribunal noted that the assessee wished to withdraw the appeals under the Vivad Se Vishwas Scheme. Since the assessee had settled the dispute and paid the tax, the Tribunal allowed the withdrawal.

The Tribunal held that the reasons for rejection were curable in nature. The discrepancies in the dissolution clause and the observations regarding the community benefit and genuineness of activities were found to be based on misinterpretations or lack of complete details from the assessee.

The Tribunal held that the reassessment proceedings were invalid as they were based on a 'change of opinion' and lacked the necessary tangible material to justify reopening. The AO failed to establish that the assessee had not made a true and full disclosure of material facts.

The Tribunal allowed the appeal against the addition of Rs. 87,84,862/- on account of alleged unexplained expenditure of interest paid to Shri Chandra Prakash Agarwal, stating that the addition was made without following the procedure under Section 153C of the Act and violated principles of natural justice. The Tribunal also allowed the appeal against the addition of Rs. 51,22,569/- on similar grounds. The appeal concerning the addition of Rs. 2,00,000/- on account of agricultural income was partly allowed. The addition concerning cash deposits of Rs. 94,77,000/- was also partly allowed.

The Tribunal held that the compensation received by the assessee was due to the closure of the unit and thus qualified as retrenchment compensation under Section 10(10B) of the Income Tax Act, 1961, and not an ex-gratia payment under Section 10(10C). The addition made by the AO was deleted.

The Tribunal held that the interest paid on partner's capital account, which was used for investments yielding rental income and interest income, should be allowed as a deduction. The disallowance of interest expenses to the extent of income was deemed unjustified under Section 57(iii) of the Act.

The Tribunal condoned the delay in filing the appeal due to the demise of the assessee's consultant. While the CIT(A) had dismissed the appeal ex-parte for lack of evidence, the Tribunal decided to admit additional evidence and remanded the matter back to the AO for fresh adjudication.

The Tribunal held that the AO was not justified in making a lump-sum addition by rejecting the books of account, especially when the assessee opted for presumptive taxation under section 44AD. The Tribunal also held that the difference in stock valuation was minor and explained by the assessee, thus no addition should be made on that account. The appeal was allowed.

The Tribunal found that the interest paid to partners on capital, which was used for both property construction and earning interest income, was not disputed as being in accordance with the law. It ruled that the disallowance of the remaining interest amount under Section 57(iii) of the Income Tax Act was not sustainable, especially since part of the claim had already been considered by the AO. Therefore, the appeals were allowed, and the disallowance was deleted.

The Tribunal held that the additions made by the AO, which were not based on incriminating material found during the search and seizure operations related to the assessee, were not sustainable. The court emphasized the procedural requirements for using material found in third-party searches under Section 153C of the Act. Furthermore, violations of natural justice principles, such as the lack of opportunity for cross-examination and non-disclosure of relied-upon documents, were noted. Some grounds were partly allowed or dismissed on merits.

The Tribunal held that the assessment order passed against a deceased person without proper legal representation or opportunity to be heard is void ab initio. Relying on precedent, the Tribunal did not concur with the CIT(A)'s order of setting aside and remanding the case, and instead allowed the assessee's appeal.

For A.Y. 2011-12 (ITA No. 114/JPR/2025), the Tribunal found that the authorities failed to establish the authenticity of the documents (Annexure A-24) and that additions based on uncorroborated loose papers are unsustainable, especially when the profit rate has already been estimated. Citing Supreme Court precedents on the evidentiary value of such documents, the Tribunal allowed the assessee's appeal and directed the deletion of the addition. For A.Y. 2015-16 (ITA No. 394/JPR/2025), the Tribunal confirmed the ad-hoc disallowances made by the lower authorities, observing the assessee's significantly low net profit ratio.

The Tribunal noted that the assessee has now obtained the registration under the Rajasthan Public Trust Act, 1959. It felt that the matter needed re-examination by the CIT(E) and restored the case to the CIT(E) for fresh adjudication, providing one more opportunity of hearing.

The Tribunal condoned the delay in filing the appeals. The Tribunal found it fit to remand the matters back to the CIT(E) to grant the applicant an opportunity to provide the necessary documents and information regarding their registration and activities.

The Tribunal held that the addition under Section 69C could not be sustained as the expenditure was for business purposes and profit had already been estimated. For the second appeal, the Tribunal noted that the disallowances were made on the ground of self-made vouchers and cash payments below Rs. 10,000/-, and also considered the assessee's profit ratios. The Tribunal also referred to the provisions of Section 292C and apex court judgments on the admissibility of evidence.

The Tribunal condoned the delay in filing the appeals, finding sufficient cause. For the Section 12AB application, the matter was remanded to the CIT(E) for fresh adjudication with an opportunity to be heard. For the Section 80G(5)(iii) application, the rejection order was set aside and the application was also restored to the CIT(E) for fresh decision.

The Tribunal, while noting that the assessee was ex-parte before the lower authorities, felt that the matter should be decided on merits. Therefore, the appeal was allowed for statistical purposes, restoring the matter to the AO for a fresh adjudication with an opportunity for the assessee to present their case.

The Tribunal condoned the delay in filing the appeals, finding sufficient cause. The Tribunal remanded the matters back to the CIT(E) for a fresh decision after providing a reasonable opportunity of being heard to the appellant, considering that the assessee claimed to be a charitable trust.

The tribunal condoned the 33-day delay in filing the appeals, finding that the reasons provided constituted a 'sufficient cause' and the issues were curable. The tribunal decided to restore both matters concerning Section 12AB registration and Section 80G approval back to the file of the CIT(E) for fresh adjudication. The CIT(E) is directed to provide adequate opportunities to the assessee to present all required documents and details to prove genuineness.

The Tribunal condoned the 6-day delay in filing the appeals, acknowledging sufficient cause. It then remanded both the application for Section 12AB registration (ITA No. 345/JPR/2025) and the application for Section 80G(5)(iii) approval (ITA No. 346/JPR/2025) back to the Learned CIT(E). The CIT(E) is directed to decide afresh after providing the appellant a reasonable opportunity to produce the Rajasthan Public Trust Act registration certificate and submit all requisite details and information concerning its activities.

The Tribunal condoned the delay in filing the appeals by taking a liberal view, considering the reasons provided by the assessee for the delay and the curable nature of the defects. The matter was restored to the CIT(E) for fresh adjudication.

The Tribunal noted that the Ld. CIT(E) did not effectively adjudicate the applicability of Section 2(15) and did not deal with judicial pronouncements. It also acknowledged new evidence from the assessee regarding changes to its objects. Therefore, the Tribunal remanded both applications (for Section 12AB registration and Section 80G(5)(iii) approval) back to the Ld. CIT(E) for a fresh decision after providing the assessee a reasonable opportunity of being heard and considering all relevant information and amendments.

The Tribunal observed that the CIT(E) did not adequately adjudicate the issue of Section 2(15) applicability or deal with the judicial pronouncements relied upon by the assessee. Additionally, new evidence concerning amendments to the trust's MOA was presented, which was not before the CIT(E). Therefore, the matter was restored to the CIT(E) for fresh adjudication.

The Tribunal dismissed the Department's appeals, affirming the CIT(A)'s decision. It relied on a High Court precedent and noted that the Department itself had subsequently issued fresh notices, implying acceptance of the legal infirmity of the earlier notices.

The Income Tax Appellate Tribunal found that the Assessing Officer and the CIT(A) had violated the principles of natural justice by not providing the assessee a reasonable opportunity of being heard. Specifically, neither the assessee nor the deponents of the additional evidence were called during remand proceedings to verify the affidavits and ledger accounts, which rendered the defects pointed out by the CIT(A) as insignificant. Consequently, the impugned order upholding the penalty was set aside.

The Tribunal held that the Assessing Officer committed a gross violation of the principles of natural justice by failing to call the assessee or deponents for remand proceedings and not verifying additional evidence. Therefore, the impugned order deserved to be set aside.

The Tribunal held that there was a gross violation of the principles of natural justice because neither the Assessing Officer nor the CIT(A) provided the assessee or the deponents of the affidavits an opportunity to be heard regarding the additional evidence or the defects pointed out for its rejection during the remand proceedings. Consequently, the Tribunal found that the CIT(A)'s order upholding the penalty was flawed.

The Tribunal held that the assessee was not afforded a proper opportunity of being heard regarding the additional evidence and defects pointed out by the CIT(A). The proceedings before the Assessing Officer and CIT(A) violated the principles of natural justice.

The Tribunal found that neither the Assessing Officer during the remand proceedings nor the Learned CIT(A) provided the assessee with a reasonable opportunity of being heard regarding the additional evidence and the defects pointed out for their rejection. This was deemed a gross violation of the principles of natural justice. Consequently, the Tribunal set aside the impugned order passed by the Learned CIT(A) upholding the penalty order.

The Tribunal held that the notices issued by the Assessing Officer were not sustainable as they should have been issued under Section 153C and not Section 148, as per the procedure for search and seizure cases. The Tribunal found no illegality in the CIT(A)'s order allowing the assessee's appeals.

The Tribunal held that the Assessing Officer committed a gross violation of the principles of natural justice by not providing the assessee an opportunity to participate in the remand proceedings and by not summoning the deponents of the affidavits. Therefore, the impugned order was set aside.

The Tribunal held that the notice under Section 148 of the Income Tax Act, 1961, issued on 29.03.2018, was invalid as it was not issued by the jurisdictional Assessing Officer, and no 'reasons to believe' were recorded by the jurisdictional officer. Consequently, the entire reassessment proceedings were set aside.