ITAT Kolkata Judgments — February 2025

The tribunal allowed the assessee's request, dismissing the appeal as withdrawn. It granted the assessee the liberty to revive the appeal by filing a miscellaneous application if their application under the Vivad Se Vishwas Scheme 2024 is unsuccessful for any reason.

The Tribunal found that the assessee's business involved huge operational expenses, resulting in a meagre net profit. Review of bank statements showed no substantial money accumulating, discrediting the AO's theory of unexplained investments u/s 69. Furthermore, the 8% estimation of income lacked any reasonable basis. Consequently, both additions were deleted.

The Tribunal condoned the delay in filing the appeal. Finding that the orders were passed ex-parte without considering the merits, the Tribunal deemed it necessary to remand the issue back to the Assessing Officer for re-examination after providing a reasonable opportunity of being heard to the assessee.

The Tribunal found that the delay was due to the assessee's representative's failure and, in the interest of justice, condoned the delay. The case was remanded back to the CIT(A) for a re-examination of the issues on merits after providing the assessee a reasonable opportunity of being heard.

The Tribunal dismissed grounds 2(a) and 2(b) concerning the delayed EPF/ESI contributions (₹10,14,070/-), citing the Supreme Court's decision in Checkmate Services Pvt. Ltd. For ground 2(c), regarding the disallowance of ₹5,39,102/- due to wrong reporting despite timely payment, the Tribunal restored the issue to the file of the Ld. AO for fresh examination of evidence, with a direction to delete the addition if timely payment is confirmed.

The Tribunal ruled that the CIT(A) erred by dismissing the appeal for non-prosecution without passing a speaking order on merits, which is mandated by Section 250(6) of the Act. Citing various precedents, it held that the CIT(A) is obligated to adjudicate appeals on merits. Consequently, the Tribunal set aside the orders of both the CIT(A) and the AO, remanding the matter back to the AO for a de novo assessment to provide the assessee a proper opportunity to be heard and submit evidence.

The Tribunal found that the additions were purely notional/hypothetical without concrete evidence, and the AO failed to reject the books of accounts or provide valid reasons. The assessment under limited scrutiny without conversion to complete scrutiny was not in accordance with law. Citing the Godhra Electricity Co. Ltd. judgment, the Tribunal ruled that income tax is on real income, not hypothetical income. The CIT(A)'s order was set aside, and the AO was directed to delete the additions.

The Income Tax Appellate Tribunal noted the assessee's withdrawal application and the Revenue's lack of objection. Consequently, the Tribunal allowed the withdrawal request and dismissed the appeal as withdrawn.

The Tribunal noted that the CIT(A) deleted the additions, and the Revenue appealed. However, the Tribunal also observed potential procedural flaws in the assessment process, such as the AO passing the order without considering the assessee's submissions and issuing notices with inadequate timelines. Consequently, the Tribunal decided to set aside the orders of the lower authorities.

The Tribunal noted that the CIT(A) had dismissed the assessee's appeal ex parte without considering the merits, despite the assessee's consistent non-appearance. To ensure justice and fair play, the Tribunal remanded the matter back to the CIT(A). The CIT(A) was directed to re-examine the issues afresh and decide the appeal on merits, providing the assessee with a reasonable opportunity of being heard, in line with Section 250(6) of the Act.

The Tribunal found significant procedural irregularities, including the AO issuing a notice requiring compliance before its issue date and passing the assessment order the next day without considering all replies. Furthermore, the CIT(A) admitted new evidence without a remand report, violating Rule 46A. Consequently, the Tribunal set aside both the CIT(A)'s and AO's orders for both assessment years and remitted the matter back to the AO for de novo assessment, granting the assessee a full opportunity to present all evidence.

Citing a relevant Calcutta High Court judgment, the ITAT allowed the appeal for statistical purposes and restored the matter to the Assessing Officer. The AO is directed to consider the belatedly filed Form 10IC and decide on the relief the assessee is entitled to, subject to fulfilling all other legal conditions.

The Tribunal allowed the appeal for statistical purposes, remanding the case to the Assessing Officer. It directed the AO to reconsider the assessee's eligibility for Section 115BAA benefits, citing a Calcutta High Court judgment that filing Form 10IC is procedural and a PCIT order condoning the delay in filing a revised return.

The Tribunal found the CIT(A)'s order cryptic, noting that the addition was deleted without proper consideration of facts regarding the source of share capital, creditworthiness, or a remand report. Therefore, both the AO's assessment order and the CIT(A)'s appellate order were set aside, and the matter was remitted back to the AO for a de novo assessment, allowing the assessee to present evidence.

The assessee orally prayed to withdraw the appeal, to which the Revenue did not object. Consequently, the appeal was dismissed as withdrawn, with liberty granted to the assessee to revive it if unsuccessful in the VSVS-24 scheme.

The Tribunal noted that the CBDT circular's revised monetary limits apply retrospectively to pending appeals. As the tax effect in this case was less than the prescribed Rs. 60 lakh, the revenue's appeal was dismissed under Section 268A of the Income Tax Act.

The Tribunal noted the assessee's contention that her non-response to notices before the AO and CIT(A) was due to various unavoidable family health issues and business challenges. Considering the submissions and in the interest of justice, the Tribunal decided to grant the assessee one last opportunity to present her case. All appeals are restored to the file of the Assessing Officer for fresh adjudication, setting aside the previous orders.

The Tribunal held that the previous appellate authority had dismissed the appeal without proper application of mind. Therefore, the case was remitted back to the Assessing Officer to examine the issue afresh after providing an opportunity of being heard to the assessee.

The assessee requested to withdraw the appeal due to participation in the VSVS 2024 scheme, which the Ld. DR did not oppose. The Tribunal dismissed the appeal as withdrawn, granting the assessee liberty to revive it by filing a miscellaneous application if the VSVS-24 scheme is unsuccessful for any reason.

The tribunal acceded to the assessee's request and dismissed the appeal as withdrawn. It granted the assessee the liberty to revive the appeal by filing a miscellaneous application if the Vivad Se Vishwas Scheme 2024 proves unsuccessful for any reason.

The Tribunal set aside the order of the CIT(Appeals) to meet the principle of natural justice. The matter was remitted back to the CIT(Appeals) with a direction to provide the assessee with one more opportunity of being heard.

The ITAT acknowledged the assessee's lack of cooperation but remitted the case back to the CIT(A) to ensure the principle of natural justice. The CIT(A) was directed to provide one more opportunity for the assessee to present its case, with a strong caution to the assessee to cooperate promptly with the proceedings.

The ITAT set aside the CIT(Appeals)'s order and remitted the matter back to the CIT(Appeals) for de novo consideration. This was done to ensure natural justice by providing the assessee another opportunity of being heard, while also cautioning her to cooperate with future proceedings.

The Tribunal dismissed the appeal as withdrawn, noting that keeping it pending would serve no purpose. It was clarified that if the Designated Authority fails to issue Form No. 4 as per Section 92(2) read with Section 93 of the Scheme, the assessee retains the liberty to file an application to recall the Tribunal's order.

The Tribunal found that the CIT(Appeals) dismissed the appeal ex-parte without considering the grounds on merit. The Tribunal decided to remit the matter back to the Assessing Officer for a fresh examination, to meet the principles of natural justice and allow the assessee to submit evidence.

The Tribunal dismissed the appeal of the assessee. However, it granted the assessee the liberty to revive the appeal by filing a miscellaneous application if they are not successful in the Direct Tax Vivad Se Vishwas Scheme, 2024, for any reason.

The ITAT, citing the principle of natural justice, set aside the order of the CIT(Appeals) and remitted the matter back to the CIT(Appeals). The CIT(Appeals) was directed to grant one more opportunity of being heard to the assessee, cautioning the assessee to cooperate promptly, failing which the CIT(Appeals) may pass an appropriate order based on available records.

The tribunal dismissed the appeal as withdrawn. However, it granted the assessee the liberty to revive the appeal by filing a necessary miscellaneous application if they are not successful in the Vivad Se Vishwas Scheme 2024 for any reason.

The Tribunal found that the CIT(Appeals) did not properly apply its mind to the grounds of appeal and allowed the appeal for statistical purposes. The matter was remitted back to the Assessing Officer.

The assessee requested to withdraw the appeal, a request that the Ld. DR did not oppose. The tribunal dismissed the appeal as withdrawn, granting the assessee the liberty to file a miscellaneous application to revive the appeal if the VSVS-24 scheme is unsuccessful for any reason.

The ITAT set aside the order of the CIT(Appeals) and remitted the matter back to the CIT(Appeals) file. The tribunal directed the CIT(Appeals) to provide another opportunity of being heard to the assessee to ensure natural justice, with a caution to the assessee to cooperate with the proceedings.

The Tribunal held that the issue was squarely covered by the Supreme Court's judgment in Kerala State Co-operative Agricultural & Rural Development Bank Ltd. Therefore, the substantial question of law was answered in favour of the assessee.

The tribunal allowed the assessee's request and dismissed the appeal as withdrawn. However, it granted liberty to the assessee to file a miscellaneous application to revive the appeal if the VSVS-24 scheme is not successful for any reason.

The Tribunal held that the *Totgars* decision was distinguishable from the present case. Citing *Vavveru Cooperative Rural Bank Ltd*, it ruled that interest income from investments in nationalized banks, when originating from the society's primary cooperative activities, is attributable to those activities and thus eligible for deduction under Section 80P(2)(a)(i). The disallowance made by the lower authorities was set aside.

The Tribunal dismissed the appeal as withdrawn, considering the assessee's participation in the DTVSVS-24 Scheme. The assessee was granted the liberty to revive the appeal by filing a miscellaneous application if the scheme does not prove successful for any reason.

The Tribunal held that the transactions of purchase of shares were accepted by the AO in earlier years and could not be treated as bogus. The assessee had sold the shares of M/s Ispat Sheets Ltd. and M/s Kirti Electro System Pvt. Ltd. to M/s Artillegence Bio-Innovations Ltd.

The Income Tax Appellate Tribunal dismissed both appeals filed by the revenue. The dismissal was due to the low tax effect, as the amount involved fell below the Rs. 60 lakh monetary limit stipulated by CBDT Circular No. 09/2024, which applies retrospectively to pending appeals. The appeals were dismissed under Section 268A of the Income Tax Act.

The tribunal, with no opposition from the Revenue, allowed the assessee to withdraw its appeal. The appeal was dismissed as withdrawn, with the liberty for the assessee to file a miscellaneous application to revive the appeal if the VSVS-24 process is unsuccessful for any reason.

The Tribunal noted that the assessee had not filed written submissions or appeared before the CIT(Appeals) despite several opportunities. The Tribunal decided to set aside the order of the CIT(Appeals) to meet the principle of natural justice and remitted the matter back to provide one more opportunity of being heard to the assessee. The assessee was cautioned to cooperate with the proceedings.

The Income Tax Appellate Tribunal dismissed the appeal. However, it granted the assessee the liberty to revive the appeal by filing a miscellaneous application if the assessee is not successful in the VSVS-24 for any reason.

The Tribunal noted that the assessee was not a shareholder of the lending company, M/s. LEIPL. Citing the Special Bench decision in Bhaumik Colour (P) Ltd. and its approval by the Calcutta High Court, the Tribunal ruled that Section 2(22)(e) provisions for deemed dividend are applicable only when the lendee is a shareholder of the lender. Consequently, the loan could not be treated as deemed dividend, and the Pr. CIT's order under Section 263 was quashed as unsustainable.

The tribunal noted that since the assessee had opted for the VSVS to settle the dispute, it was unnecessary to keep the appeal pending for adjudication. Therefore, the appeal filed by the revenue was disposed of, with liberty granted to the revenue to revive it if the VSVS-24 outcome is not favorable.

The Tribunal allowed the appeal, setting aside the order of the CIT(Appeals) to meet the principle of natural justice. The matter was remitted back to the CIT(Appeals) with a direction to provide one more opportunity to the assessee to be heard, while cautioning the assessee to cooperate.

The Tribunal found that the assessee's non-appeal against the assessment order implied acceptance of the additions, making the concealment of income evident. It held that the CIT(A) erred by deleting the penalty on mere technical grounds and by not allowing the AO to clarify discrepancies. Citing the Calcutta High Court, the Tribunal affirmed that a Section 274 notice issued after recording concealed income particulars in the assessment order is valid. Consequently, the Tribunal set aside the CIT(A)'s order and remitted the matter back to the CIT(A) for fresh adjudication after providing both the AO and the assessee an opportunity to be heard.

The Tribunal condoned the delay in filing the appeal. It then set aside the CIT(A)'s order, remitting the matter back to the CIT(A) to provide the assessee another opportunity to be heard, emphasizing the principle of natural justice. The assessee was cautioned to cooperate with the proceedings.

The Tribunal noted the continuous non-response from the assessee due to unavoidable circumstances such as family health issues and business losses. For the interest of justice, the Tribunal decided to give the assessee one last opportunity.

The Tribunal dismissed the revenue's appeals, affirming the CIT(A)'s decision to allow the deduction under Section 80P for the interest income earned from nationalized banks. The Tribunal noted that the issue was covered by the Calcutta High Court's judgment for the assessee's own case in an earlier assessment year, which in turn relied on the Supreme Court's ruling in *Kerala State Co-operative Agricultural & Rural Development Bank Ltd.*

The tribunal dismissed the appeal as withdrawn. It granted the assessee the liberty to revive the appeal by filing a miscellaneous application if they are unsuccessful in the VSVS-24 scheme for any reason.

The Tribunal held that since the original assessment was completed and no proceedings were pending on the date of search, the assessment u/s 153A is bad in law, especially in the absence of any incriminating material. Furthermore, the disallowance u/s 40A(3) was not sustainable on merits as the cash payments were advances to project managers and within the prescribed limits.