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The Tribunal held that the reopening of assessment is bad in law. The Tribunal noted that the AO reopened the case based on alleged bogus billing of Rs. 2,54,00,000/-, but subsequently made an addition of Rs. 8,13,80,000/- based on bank statement entries, which was a different issue. This deviation from the reasons for reopening was considered a jurisdictional defect. Furthermore, the Tribunal found that the notice issued under Section 148 was barred by limitation. Citing the Supreme Court's decision in Union of India v. Rajeev Bansal and subsequent High Court and Tribunal decisions, the Tribunal held that the relaxation granted by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) was not available for Assessment Year 2015-16 for the extended period. The Tribunal quashed the reopening of the assessment and the consequent assessment order. The CIT(A)'s order was also set aside.
The Tribunal held that in the interests of justice and fair play, the issue should be restored to the Assessing Officer for fresh adjudication. The reasoning was based on the fact that the assessee could not furnish evidence during the remand proceedings due to circumstances beyond their control, despite notices being issued. The Tribunal set aside the order of the CIT(A) and restored the matter to the file of the AO with a direction to pass a fresh order after affording sufficient and reasonable opportunities of being heard to the assessee. The ratio decidendi is that procedural fairness and the opportunity to present one's case are paramount, especially when non-compliance is attributed to factors beyond the assessee's control. The operative direction is to set aside the CIT(A)'s order and remand the matter to the AO.
The Tribunal allowed the appeal of the assessee. Regarding the addition of ₹ 13,84,000 under Section 69A, the Tribunal noted that the assessee had provided documents including a sale agreement dated 13.09.2015, which was cancelled on 06.12.2016 by mutual consent with 'M/s. Maa Tara Constructions'. The Tribunal found that the amount was received by the assessee as per the money receipt and cancellation agreement, and it was not disputed that the assessee obtained a loan of ₹ 15 lakhs from the bank, which was transferred to 'M/s Maa Tara Construction' and later returned. The Tribunal concluded that the amount deposited in the bank was explained, and therefore, the addition made by the AO under Section 69A was not warranted. Consequently, the Tribunal directed the deletion of the addition. The Tribunal did not specifically address the grounds related to Section 115BBE, penalty proceedings under Section 271AAC(1), or the procedural aspect of the CIT(A) not conducting a remand inquiry, as the primary issue of the addition under Section 69A was decided in favour of the assessee, rendering these subsequent issues moot in this context. The ratio decidendi is that where the source of cash deposits can be demonstrably traced to a refund of a prior legitimate transaction, supported by documentary evidence, and the transaction itself is not disputed, the addition under Section 69A is not sustainable.
The Tribunal found no infirmity in the order of the CIT(A). The assessee is a company engaged in manufacturing and trading of fabrics. The AO had disallowed unsecured loans and interest thereon amounting to Rs. 80,32,513/- under Section 68. The Tribunal noted that the lender companies were registered under the Companies Act, 1956, possessed PANs, were regular income tax return filers, and all transactions were conducted through banking channels and duly accounted for. The creditworthiness of the lenders was established by their balance sheets, showing substantial net worth (Alka Diamond Industries Ltd: Rs. 17,74,85,531/-, Duke Business P. Ltd: Rs. 1,11,24,16,204/-, and Olive Overseas P. Ltd: Rs. 6,27,16,78,62/-). The Tribunal considered the facts and the CIT(A)'s order and concluded that the addition made by the AO was not sustainable. The ratio decidendi is that when an assessee provides sufficient documentary evidence to establish the identity, creditworthiness, and genuineness of the transaction for unsecured loans, and the AO fails to bring contrary evidence on record, the addition under Section 68 is not justified. The appeal of the Revenue was dismissed.
The Tribunal held that the notice under section 148A(b) was issued without providing the assessee with the relevant information and material relied upon by the Assessing Officer. This non-compliance with the mandatory requirement of furnishing supporting documents along with the show-cause notice renders the notice bad in law. The Tribunal relied on the Supreme Court's decisions in Union of India v. Ashish Agarwal and Union of India v. Rajeev Bansal, which emphasize that a show-cause notice under Section 148A(b) is effectively issued only when accompanied by the relevant information and material. Since the Assessing Officer failed to provide the 'Rukkas' or any other supporting material along with the notice, the condition for issuing the notice under Section 148A(b) was not met. Consequently, the Tribunal quashed the notice under section 148A(b) and, by implication, all subsequent proceedings, including the reassessment order. The appeal of the assessee was allowed on this legal issue.
The Tribunal held that the notice issued under Section 148 of the Income Tax Act, 1961, dated 29.07.2022, for the Assessment Year 2015-16, was time-barred. The Tribunal relied on the Supreme Court's decision in Deepak Steel and Power Limited Vs Central Board of Direct Taxes, which cited a concession made by the Revenue in the case of Union of India and Ors. v. Rajeev Bansal. In that concession, the Revenue conceded that for the assessment year 2015-2016, all notices issued on or after April 1, 2021, would have to be dropped as they would not fall for completion during the period prescribed under the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. Since the notice in the present case was dated 29.07.2022, it fell within the scope of this concession. Consequently, the Tribunal quashed the notice and set aside all subsequent proceedings. The appeal was allowed.
The Tribunal condoned the delay of 9 days in filing the appeal before the ITAT, citing the Supreme Court's decisions in Shakuntala Devi Jain v. Kuntal Kumari and N. Balakrishnan v. M. Krishnamurthy, which emphasize a liberal construction of 'sufficient cause' to advance substantial justice. The Tribunal noted that the CIT(A) had dismissed the appeal solely on the ground of delay without considering the assessee's explanation. Furthermore, the Tribunal observed that the order passed by the Assessing Officer was ex-parte. Therefore, the Tribunal set aside the orders of the lower authorities and remitted the appeal back to the file of the AO. The AO was directed to pass a fresh order after affording an opportunity of hearing to the assessee. The assessee was directed to cooperate in the remand proceedings. The appeal was allowed for statistical purposes.
The Tribunal held that the assessee is entitled to exemption under Section 10(26AAA) of the Income Tax Act, 1961, even if the return of income was not filed within the due dates specified under Section 139(1) or Section 148. The Tribunal reasoned that the AO cannot deny an exemption that is clearly applicable to the assessee under Section 10(26AAA). The residential status of the assessee was not disputed by the lower authorities. The Tribunal found that the AO had accepted the bank transactions as turnover and computed the business income, including the net profit of ₹26,85,052/-. The Tribunal emphasized that any class of income that is exempt under the Act cannot be brought to tax merely for the non-filing of an income tax return. The argument that Section 147 is beneficial to the revenue was deemed not applicable, as it is the AO's duty to make a correct assessment as per the Act's provisions. Consequently, the appeal filed by the assessee was allowed.
The Tribunal noted that the Assessing Officer (AO) had passed an ex parte order under Section 144 on 15.12.2017. Subsequently, the Principal CIT (Pr.CIT) exercised jurisdiction under Section 263 of the Act, setting aside the earlier order and restoring it to the AO for fresh assessment, with directions to provide a reasonable opportunity of being heard to the assessee. The Tribunal also noted that a Coordinate Bench of the ITAT had restored the Pr.CIT's order for fresh adjudication. The Tribunal held that once the Pr.CIT exercised jurisdiction under Section 263 and set aside the earlier order, the earlier order lost its credential value, and no demand would sustain based on it. Therefore, the appeal of the assessee was dismissed. The Tribunal did not expressly leave any issue undecided.
The Tribunal held that the disallowance of Rs. 32,00,000/- paid as brokerage and commission was not tenable. The assessee had demonstrated the contribution of each commission agent with cogent evidence. All transactions were made through A/c payee cheques, and TDS under Section 194H was deducted and deposited. Furthermore, the sub-agents were income tax assessees and had filed their returns for AY 2014-15. The AO had also issued notices under Section 133(6) to the payees, who complied by filing payment acknowledgements, IT return acknowledgements, and copies of their accounts. The Tribunal relied on its decision in Smt. Renu Sudhesh Kapoor Vs DCIT, which held that disallowance was unjustified when the department had no evidence to establish that sub-brokerage was not paid, especially when payments were made through banking channels and TDS was deducted. Accordingly, the disallowance was deleted.
The Tribunal held that the assessee's case was covered by the exception carved in Clause (a) to Section 270A(6) of the Income Tax Act, 1961. The Tribunal noted that the medical hardship suffered by the appellant was accepted as a reasonable cause for not filing the return within the due date, as evidenced by the cancellation of the penalty under section 271F. The assessee had also satisfactorily discharged their obligations by paying differential tax and interest and filing the return in response to the notice under section 148. The Tribunal observed that the assessee's income was substantially covered by TDS, the assessment was completed without any variation, and no contumacious conduct was brought on record. The explanation offered by the assessee was considered bona fide. Therefore, the Tribunal directed the Assessing Officer to cancel the impugned penalty under section 270A. As the penalty was cancelled in toto, the ground regarding excess penalty levied became irrelevant. The appeal of the assessee was allowed.
On the issue of Section 14A disallowance (Grounds 1 & 2), the Tribunal held that while administrative overheads are incurred, the interest component of the disallowance calculated under Rule 8D could not stand, as the assessee possessed interest-free own capital far exceeding tax-exempt investments. Applying the jurisdictional precedent, the interest component was deleted. The administrative disallowance under Rule 8D(2)(iii) was restricted to investments yielding exempt dividend income and directed to be recomputed. This ground was partly allowed. Regarding the undisclosed interest income (Ground 3), the Tribunal noted the assessee's explanation of an unauthorized credit by M/s Unitech Ltd. but also the failure to produce formal confirmations. In the interest of natural justice, the issue was remitted back to the AO for fresh adjudication after the assessee furnishes necessary reconciliations and communication history. This ground was allowed for statistical purposes. Concerning the disallowance of salary expenses (Ground 5), the Tribunal found the complete disallowance of approximately 80% on an ad-hoc basis unsustainable for a commercial entity. The addition was deleted, and this issue was allowed in favour of the assessee. For the ad-hoc disallowance of business expenses (Ground 4), the Tribunal observed that contract notes and statements were filed, vouching the transactions. The ad-hoc disallowance was fully deleted, and this issue was allowed in favour of the assessee. Technical/general grounds (Grounds 6 & 7) were dismissed as they required no separate adjudication.
The Tribunal noted that the Assessing Officer had not found any defects in the books of account, nor had the books been rejected for any reasons. The Ld. CIT(A) had also found that the invocation of Section 40A(2)(b) was not relevant. In these circumstances, the Tribunal held that the Assessing Officer was not justified in estimating the income. Furthermore, the Tribunal observed that neither the AO nor the Ld. CIT(A) had referred to any comparable case, rendering the estimation at 10% baseless. Consequently, the Tribunal directed the Assessing Officer to delete the impugned addition. The ratio decidendi is that ad hoc estimation of income is not permissible without rejecting the books of account, especially when no defects are found and no comparable cases are cited to justify the estimation.
The Tribunal held that the order of the CIT(E) was not justified. The Tribunal found that the facts had not been properly appreciated by the CIT(E) and that the cancellation of the provisional approval without following the provisions of Section 12AB(4) of the Act was not justified. The Tribunal was of the view that one more opportunity should be provided to the assessee as the required evidence could not be properly appreciated by the CIT(E). Therefore, the Tribunal set aside the order of the CIT(E) and remanded the matter back to the CIT(E) for deciding the application afresh. The CIT(E) was directed to grant an opportunity of being heard to the assessee, consider any reply filed, and pass a speaking order in accordance with law. The assessee was directed not to seek unnecessary adjournments and to file the required evidence. For statistical purposes, the grounds of appeal were partly allowed.
The Tribunal decided the issues as follows: Regarding Ground 2 (site expenses), the Tribunal found the 50% disallowance to be unreasonable. While acknowledging that in the absence of complete bills and vouchers, expenditure remains unverified, the Tribunal proposed a disallowance of 10% of the expenditure claimed, to which both the assessee and revenue had no objection. The disallowance was restricted to 10%, reversing the CIT(A)'s finding, and this ground was partly allowed. Regarding Ground 3 (import figures), the assessee did not press this ground as they were unable to reconcile the discrepancy, and it was dismissed as 'not pressed'. Regarding Ground 4 (undisclosed income from services), the Tribunal found that the assessee had adequately reconciled the difference, which arose from works contract being included in service tax returns while shown as sales in the return of income. The addition was deleted, and this ground was allowed. Regarding Ground 5 (interest u/s 115P), the Tribunal noted that DDT was paid on time and there was no mention of interest in the assessment order. The interest was inadvertently included and confirmed cryptically by the CIT(A). The Tribunal directed its deletion, and this ground was allowed. Regarding Grounds 1 and 7 (general grounds), they were considered general and did not require separate adjudication. Regarding Ground 6 (interest u/s 234A, 234B, 234C), this was not explicitly decided but would be consequential to the relief granted on other grounds.
The Tribunal held that there was an apparent error in the facts and issues discussed in the impugned appellate order passed by the Ld. CIT(A). The Tribunal noted that the Ld. CIT(A)'s order, in its factual background, discussed an addition of Rs. 5,60,000/- and that the assessee had not appeared for various hearing notices issued by the Ld. CIT(A). Consequently, the Ld. CIT(A) had dismissed the appeal for non-prosecution and on merits for want of evidence. Given these discrepancies and the assessee's submission regarding factual errors and non-consideration of submissions, the Tribunal set aside the impugned order of the Ld. CIT(A). The matter was restored to the file of the Ld. CIT(A) with a direction to adjudicate afresh after affording an opportunity of hearing to the assessee. The assessee was also directed to comply with the hearing notices of the Ld. CIT(A).
The Tribunal held that the reopening of assessment under Section 147 read with Section 148A of the Income Tax Act, 1961, was invalid. The primary reason for this decision was the significant factual discrepancy between the amount stated in the reasons recorded for reopening (Rs. 25,32,484.05) and the amount actually added to the assessee's income in the assessment order (Rs. 50,64,968/-). The Tribunal noted that the reasons recorded for reopening were factually incorrect and had no link with the actual transaction or deposit in the assessee's bank account. Furthermore, the Tribunal observed that the assessee had provided an explanation regarding the credit of Rs. 50,64,968/- as sale proceeds of shares held for more than one year, with the resultant Long Term Capital Gain being exempt under Section 10(38), an explanation the AO did not further inquire into. Citing the ITAT Kolkata decision in ITA No. 51/2025 and the Calcutta High Court decision in BB Poddar Foundation for Education, the Tribunal emphasized that a valid notice is the foundation of reassessment proceedings, and if the notice is unsustainable, the entire edifice collapses. The reassessment order was set aside. The issue of whether the Rs. 50,64,968/- represented sale proceeds of shares and was exempt under Section 10(38) was not decided on merits due to the invalidity of the reopening.
The Tribunal held that the appeals of the assessees were to be allowed. The Tribunal noted that the assessees had inadvertently offered the compensation received under the BSNL VRS-2019 to tax due to a lack of awareness of the exemption available under Section 10(10B) of the Income Tax Act, 1961. The Tribunal found that the assessees had filed their claims before the Ld. CIT(A) and, since the income was not taxable, the assessees were eligible for a refund of the Tax Deducted at Source (TDS). The Tribunal respectfully followed the judgment of the Coordinate Bench in Harish Kumar vs. ITO Ward 5(5), Chandigarh, and similar other cases, which supported the assessee's case on similar facts. The Tribunal allowed all 10 appeals filed by the different assessees.
The Tribunal held that the appeals of the assessees were to be allowed. The Tribunal noted that the assessees had inadvertently offered the compensation received under the BSNL VRS-2019 to tax due to a lack of awareness of the exemption available under Section 10(10B) of the Income Tax Act, 1961. The Tribunal found that the assessees had filed their claims before the Ld. CIT(A) and, since the income was not taxable, the assessees were eligible for a refund of the Tax Deducted at Source (TDS). The Tribunal respectfully followed the judgment of the Coordinate Bench in Harish Kumar vs. ITO Ward 5(5), Chandigarh, and similar other cases, which supported the assessee's case on similar facts. The Tribunal allowed all 10 appeals filed by the different assessees.
The Tribunal condoned the delay of 1301 days in filing the appeal, following the principle of consistency and the co-ordinate bench's decision in the assessee's own case for AY 2020-21. The Tribunal noted that the delay was due to the treasurer's illness and demise, which caused administrative disruption. Regarding the substantive grounds, the Tribunal, by following the principle of consistency and the order of the co-ordinate bench in the assessee's own case for AY 2020-21, set aside the order of the CIT(A) and the intimation of the AO. The matter was remitted back to the Assessing Officer (AO) for considering the assessee's claim afresh. The reasoning was that the audit report (Form 10B) was available at the time of processing the return of income, and therefore, the claim of exemption under Section 11 of the Act should have been allowed. The assessee was to be given a reasonable opportunity to make further submissions. All grounds taken by the assessee were allowed for statistical purposes.
The Tribunal held that the appeals of the assessees were to be allowed. The Tribunal noted that the assessees had inadvertently offered the compensation received under the BSNL VRS-2019 to tax due to a lack of awareness of the exemption available under Section 10(10B) of the Income Tax Act, 1961. The Tribunal found that the assessees had filed their claims before the Ld. CIT(A) and, since the income was not taxable, the assessees were eligible for a refund of the Tax Deducted at Source (TDS). The Tribunal respectfully followed the judgment of the Coordinate Bench in Harish Kumar vs. ITO Ward 5(5), Chandigarh, and similar other cases, which supported the assessee's case on similar facts. The Tribunal allowed all 10 appeals filed by the different assessees.
The Tribunal noted that both the Assessing Officer and the CIT(A) had passed ex-parte orders due to the assessee's non-compliance. In the interest of justice and fair play, and considering the assessee's request for a remand to the Assessing Officer for de novo assessment with an opportunity to present sufficient evidence, the Tribunal decided to set aside both the orders of the Assessing Officer and the CIT(A). The matter was remitted to the Assessing Officer for reassessment. The assessee was directed to be given a reasonable opportunity of being heard and was cautioned against seeking unnecessary adjournments. Consequently, the grounds of appeal in ITA No. 2407/KOL/2026 were partly allowed for statistical purposes. For ITA Nos. 2408/KOL/2026 (penalty under Section 271(1)(b)) and 2409/KOL/2026 (penalty under Section 271(1)(c)), since the quantum appeal was set aside and the assessment was to be done afresh, the orders of the lower authorities were also set aside and remitted to the Assessing Officer with a direction to reframe the penalty orders after the finalization of assessment proceedings. All grounds in these penalty appeals were also partly allowed for statistical purposes. The Tribunal did not decide the substantive issues of addition and penalties on merits.
The Tribunal condoned the delay of 225 days in filing the appeal, finding sufficient cause based on the assessee's submissions regarding lack of electronic communication and professional dependency, and applying the liberal interpretation of "sufficient casus" as laid down by the Supreme Court in Collector, Land & Acquisition vs. Mst. Katiji & Others. Regarding the substantive appeal, the Tribunal noted that the Ld. CIT(A)'s order was ex-parte, and the assessee had not participated in the proceedings. Furthermore, the Ld. CIT(A) had not decided all grounds of appeal on their merits. The Tribunal also acknowledged that the assessee had not made full compliance before the Assessing Officer. In the interest of justice, the Tribunal restored the issue to the file of the Assessing Officer for de-novo assessment, directing the Assessing Officer to provide an opportunity of being heard to the assessee and the assessee to participate in the proceedings without fail. The ratio decidendi is that where an appellate order is ex-parte and does not decide all grounds on merits due to non-participation of the assessee, even if the assessee had compliance issues before lower authorities, restoration for de-novo assessment is appropriate to ensure substantial justice.
The Tribunal held that the appeals of the assessees were to be allowed. The Tribunal noted that the assessees had inadvertently offered the compensation received under the BSNL VRS-2019 to tax due to a lack of awareness of the exemption available under Section 10(10B) of the Income Tax Act, 1961. The Tribunal found that the assessees had filed their claims before the Ld. CIT(A) and, since the income was not taxable, the assessees were eligible for a refund of the Tax Deducted at Source (TDS). The Tribunal respectfully followed the judgment of the Coordinate Bench in Harish Kumar vs. ITO Ward 5(5), Chandigarh, and similar other cases, which supported the assessee's case on similar facts. The Tribunal allowed all 10 appeals filed by the different assessees.
The Tribunal noted that both the Assessing Officer and the CIT(A) had passed ex-parte orders due to the assessee's non-compliance. In the interest of justice and fair play, and considering the assessee's request for a remand to the Assessing Officer for de novo assessment with an opportunity to present sufficient evidence, the Tribunal decided to set aside both the orders of the Assessing Officer and the CIT(A). The matter was remitted to the Assessing Officer for reassessment. The assessee was directed to be given a reasonable opportunity of being heard and was cautioned against seeking unnecessary adjournments. Consequently, the grounds of appeal in ITA No. 2407/KOL/2026 were partly allowed for statistical purposes. For ITA Nos. 2408/KOL/2026 (penalty under Section 271(1)(b)) and 2409/KOL/2026 (penalty under Section 271(1)(c)), since the quantum appeal was set aside and the assessment was to be done afresh, the orders of the lower authorities were also set aside and remitted to the Assessing Officer with a direction to reframe the penalty orders after the finalization of assessment proceedings. All grounds in these penalty appeals were also partly allowed for statistical purposes. The Tribunal did not decide the substantive issues of addition and penalties on merits.
The Tribunal held that the appeals of the assessees were to be allowed. The Tribunal noted that the assessees had inadvertently offered the compensation received under the BSNL VRS-2019 to tax due to a lack of awareness of the exemption available under Section 10(10B) of the Income Tax Act, 1961. The Tribunal found that the assessees had filed their claims before the Ld. CIT(A) and, since the income was not taxable, the assessees were eligible for a refund of the Tax Deducted at Source (TDS). The Tribunal respectfully followed the judgment of the Coordinate Bench in Harish Kumar vs. ITO Ward 5(5), Chandigarh, and similar other cases, which supported the assessee's case on similar facts. The Tribunal allowed all 10 appeals filed by the different assessees.
The Tribunal noted that the assessee claimed the land was agricultural, which would exempt it from capital gains tax and potentially render Sections 50C and 56(2)(x) inapplicable. However, the required documents to substantiate this claim were not filed before the Assessing Officer (AO) or the Learned Commissioner of Income Tax (Appeals) [CIT(A)]. The Tribunal observed that while the assessee submitted a Gram Panchayat certificate and deeds claiming the land as 'shali' (agricultural), the revenue pointed out that another deed mentioned the land was proposed for industrial use. Given that these documents were filed before the Tribunal and went to the root of the matter, the Tribunal deemed it necessary for the AO to examine them. Consequently, the Tribunal set aside both the order of the AO and the CIT(A) and remanded the issue back to the AO for de novo assessment. The assessee was directed to file evidence for the claim that the land sold was agricultural, and the AO was instructed to examine this evidence, considering that some development appeared to have been carried out by the assessee. The AO was also to recompute the income after providing the assessee an opportunity of being heard. The grounds of appeal were partly allowed for statistical purposes.
The Tribunal held that the appeals of the assessees were to be allowed. The Tribunal noted that the assessees had inadvertently offered the compensation received under the BSNL VRS-2019 to tax due to a lack of awareness of the exemption available under Section 10(10B) of the Income Tax Act, 1961. The Tribunal found that the assessees had filed their claims before the Ld. CIT(A) and, since the income was not taxable, the assessees were eligible for a refund of the Tax Deducted at Source (TDS). The Tribunal respectfully followed the judgment of the Coordinate Bench in Harish Kumar vs. ITO Ward 5(5), Chandigarh, and similar other cases, which supported the assessee's case on similar facts. The Tribunal allowed all 10 appeals filed by the different assessees.
The Tribunal held that the appeals of the assessees were to be allowed. The Tribunal noted that the assessees had inadvertently offered the compensation received under the BSNL VRS-2019 to tax due to a lack of awareness of the exemption available under Section 10(10B) of the Income Tax Act, 1961. The Tribunal found that the assessees had filed their claims before the Ld. CIT(A) and, since the income was not taxable, the assessees were eligible for a refund of the Tax Deducted at Source (TDS). The Tribunal respectfully followed the judgment of the Coordinate Bench in Harish Kumar vs. ITO Ward 5(5), Chandigarh, and similar other cases, which supported the assessee's case on similar facts. The Tribunal allowed all 10 appeals filed by the different assessees.
The Tribunal considered the submission made by the assessee. In view of the fact that the quantum addition has been deleted by the Tribunal in a prior appeal (ITA No. 457/KOL/2023 for AY 2018-19 dated 22.04.2026), the penalty imposed is hereby cancelled. The reasoning is that the penalty was levied based on the addition made under Section 68, and once the addition itself is deleted, the basis for the penalty ceases to exist. The Tribunal did not explicitly address all grounds raised by the assessee, particularly those concerning limitation, service of notice under Section 143(2), and the merits of the share capital addition, as the cancellation of the penalty was based solely on the deletion of the primary addition. The operative direction is the cancellation of the penalty.
The Tribunal noted that the assessee's primary contention was that documents were lost due to the Amphan cyclone, and while some documents were subsequently obtained and filed before the CIT(A), they were not admitted. The assessee requested a remand to the AO for a fresh assessment. The Revenue relied on the CIT(A)'s order, arguing that the assessee failed to furnish required evidence before both authorities. The Tribunal, considering the interest of justice and fair play, found that there was no proper compliance before the AO or CIT(A). Therefore, the Tribunal allowed the assessee to file additional evidence before the AO and set aside the CIT(A)'s order, remitting the matter back to the AO for de novo reassessment. The assessee was to be given a reasonable opportunity of being heard. The grounds taken by the assessee were partly allowed for statistical purposes.
The Tribunal held that the appeals of the assessees were to be allowed. The Tribunal noted that the assessees had inadvertently offered the compensation received under the BSNL VRS-2019 to tax due to a lack of awareness of the exemption available under Section 10(10B) of the Income Tax Act, 1961. The Tribunal found that the assessees had filed their claims before the Ld. CIT(A) and, since the income was not taxable, the assessees were eligible for a refund of the Tax Deducted at Source (TDS). The Tribunal respectfully followed the judgment of the Coordinate Bench in Harish Kumar vs. ITO Ward 5(5), Chandigarh, and similar other cases, which supported the assessee's case on similar facts. The Tribunal allowed all 10 appeals filed by the different assessees.
The Tribunal considered the rival contentions and the facts of the case. The assessee requested that the case be set aside before the Assessing Officer (AO) to provide a proper opportunity of being heard and to file the required documents. The Tribunal, in the interest of justice and fair play, found it appropriate to allow the assessee's request. Consequently, the Tribunal set aside the order of the CIT(A) and remitted the matter back to the AO for reassessment de novo. The assessee was directed to be given a reasonable opportunity to be heard and to make further submissions, with a caution against seeking unnecessary adjournments. The grounds of appeal were partly allowed for statistical purposes.
The Tribunal held that the addition made by the Assessing Officer and confirmed by the CIT(A) was liable to be deleted. The Tribunal noted that the Assessing Officer's assessment order itself acknowledged that the replies received confirmed the assessee's transactions. However, the AO, relying on an investigation wing report concerning M/s Marigold Vanijya Pvt. Ltd., vaguely stated that the replies were manipulated. Crucially, the AO did not bring forth any evidence to demonstrate that the assessee had actually transacted with M/s Marigold Vanijya Pvt. Ltd. Since the AO's own examination revealed that the assessee transacted with M/s Encash Securities Pvt. Ltd., the very foundation of the addition collapsed. Furthermore, the Tribunal took cognizance of multiple decisions from its coordinate benches where additions based on similar circumstances, involving M/s Marigold Vanijya Pvt. Ltd. and Mr. Sachet Saraf's statements, were deleted after it was recognized that Mr. Sachet Saraf had retracted his statement. Therefore, the addition was deleted. The appeal of the assessee was allowed.
The Tribunal held that the difference of ₹1,80,945/- should be added to the business income instead of being treated as unexplained investment under Section 69B of the Act. The Bench reasoned that following the order of the jurisdictional High Court in the case of Daulatram Rawatmull and considering that the assessee was in the business of putting up road signs, the valuation difference arose without any difference in quantity. Therefore, it was more appropriate to consider this as part of business income. Consequently, Grounds I to IV of the appeal were allowed. Grounds V to VII were considered general in nature and did not require separate adjudication. The appeal filed by the assessee was allowed.
The Tribunal held that the penalty under Section 270A was not liable to be imposed. The Tribunal noted that the AO initiated penalty proceedings for under-reporting of income in consequence of misreporting of income. However, referencing the Supreme Court's decision in CIT vs. Reliance Petroproducts (P.) Ltd., the Tribunal found that the assessee had furnished all details of its expenditure and income in its return, and these details were not found to be inaccurate. A mere claim for depreciation, even if disallowed by the AO, does not amount to furnishing inaccurate particulars or concealment of income. The Tribunal observed that the assessee's claim for depreciation, which was set off against income from other sources, was a bona fide explanation. Therefore, the case did not fall under the misrepresentation or suppression of facts as contemplated by Section 270A(9)(a). The Tribunal concluded that the penalty for under-reporting of income in consequence of misreporting was not liable to be imposed and cancelled the same. The appeal was partly allowed.
The Tribunal allowed Grounds No. 4 and 9, setting aside the order of the CIT(A) and deleting the addition of ₹13,00,000/- made by the AO. The Tribunal found that the addition made by the AO had no basis. The Tribunal noted that the AO's conclusion that the assessee company was running on paper and that summons to intermediate companies were not replied did not justify the addition. The Tribunal observed that the assessee had denied any such transaction and had admitted a transaction of ₹7 Lakhs and ₹6 Lakhs from M/s. Topten Fashion Pvt. Ltd. on account of share application money, which was used for share allotment in subsequent years. The AO had not rebutted the assessee's denial with any evidence regarding transactions with M/s. Keytouch Marketing Private Limited. The Tribunal also noted that the CIT(A), instead of examining the case as per the Tribunal's direction, had once again referred the proceedings back to the AO. Grounds No. 1, 5, and 6 were dismissed. Other grounds were considered general and did not require separate adjudication as the addition was deleted. The appeal was partly allowed.
The Tribunal noted that both the Assessing Officer and the CIT(A) had passed ex-parte orders due to the assessee's non-compliance. In the interest of justice and fair play, and considering the assessee's request for a remand to the Assessing Officer for de novo assessment with an opportunity to present sufficient evidence, the Tribunal decided to set aside both the orders of the Assessing Officer and the CIT(A). The matter was remitted to the Assessing Officer for reassessment. The assessee was directed to be given a reasonable opportunity of being heard and was cautioned against seeking unnecessary adjournments. Consequently, the grounds of appeal in ITA No. 2407/KOL/2026 were partly allowed for statistical purposes. For ITA Nos. 2408/KOL/2026 (penalty under Section 271(1)(b)) and 2409/KOL/2026 (penalty under Section 271(1)(c)), since the quantum appeal was set aside and the assessment was to be done afresh, the orders of the lower authorities were also set aside and remitted to the Assessing Officer with a direction to reframe the penalty orders after the finalization of assessment proceedings. All grounds in these penalty appeals were also partly allowed for statistical purposes. The Tribunal did not decide the substantive issues of addition and penalties on merits.
The Tribunal held that the appeals of the assessees were to be allowed. The Tribunal noted that the assessees had inadvertently offered the compensation received under the BSNL VRS-2019 to tax due to a lack of awareness of the exemption available under Section 10(10B) of the Income Tax Act, 1961. The Tribunal found that the assessees had filed their claims before the Ld. CIT(A) and, since the income was not taxable, the assessees were eligible for a refund of the Tax Deducted at Source (TDS). The Tribunal respectfully followed the judgment of the Coordinate Bench in Harish Kumar vs. ITO Ward 5(5), Chandigarh, and similar other cases, which supported the assessee's case on similar facts. The Tribunal allowed all 10 appeals filed by the different assessees.
The Tribunal held that the appeals of the assessees were to be allowed. The Tribunal noted that the assessees had inadvertently offered the compensation received under the BSNL VRS-2019 to tax due to a lack of awareness of the exemption available under Section 10(10B) of the Income Tax Act, 1961. The Tribunal found that the assessees had filed their claims before the Ld. CIT(A) and, since the income was not taxable, the assessees were eligible for a refund of the Tax Deducted at Source (TDS). The Tribunal respectfully followed the judgment of the Coordinate Bench in Harish Kumar vs. ITO Ward 5(5), Chandigarh, and similar other cases, which supported the assessee's case on similar facts. The Tribunal allowed all 10 appeals filed by the different assessees.
The Tribunal held that the additions made by the AO were based on the assessee's books of accounts and other evidences furnished by the assessee, not on any incriminating material found during the search on the Surana Group. The Tribunal noted that the assessments for the impugned assessment years had already attained finality and had not abated. Relying on the Supreme Court's decision in PCIT v. Abhisar Buildwell P. Ltd. and the Calcutta High Court's decision in PCIT Vs. Sri Shanti Kumar Surana (which followed Abhisar Buildwell), the Tribunal held that in cases of unabated and completed assessments, additions can only be made if there is incriminating material unearthed during the search. Since no such material was found concerning the additions in question, the AO lacked jurisdiction to make them under Section 153C/153A. Consequently, the Tribunal set aside the order of the CIT(A) and directed the AO to delete the additions. The appeals of the assessee were allowed.
The Tribunal held that the additions made by the AO were based on the assessee's books of accounts and other evidences furnished by the assessee, not on any incriminating material found during the search on the Surana Group. The Tribunal noted that the assessments for the impugned assessment years had already attained finality and had not abated. Relying on the Supreme Court's decision in PCIT v. Abhisar Buildwell P. Ltd. and the Calcutta High Court's decision in PCIT Vs. Sri Shanti Kumar Surana (which followed Abhisar Buildwell), the Tribunal held that in cases of unabated and completed assessments, additions can only be made if there is incriminating material unearthed during the search. Since no such material was found concerning the additions in question, the AO lacked jurisdiction to make them under Section 153C/153A. Consequently, the Tribunal set aside the order of the CIT(A) and directed the AO to delete the additions. The appeals of the assessee were allowed.
The Tribunal held that the additions made by the AO were based on the assessee's books of accounts and other evidences furnished by the assessee, not on any incriminating material found during the search on the Surana Group. The Tribunal noted that the assessments for the impugned assessment years had already attained finality and had not abated. Relying on the Supreme Court's decision in PCIT v. Abhisar Buildwell P. Ltd. and the Calcutta High Court's decision in PCIT Vs. Sri Shanti Kumar Surana (which followed Abhisar Buildwell), the Tribunal held that in cases of unabated and completed assessments, additions can only be made if there is incriminating material unearthed during the search. Since no such material was found concerning the additions in question, the AO lacked jurisdiction to make them under Section 153C/153A. Consequently, the Tribunal set aside the order of the CIT(A) and directed the AO to delete the additions. The appeals of the assessee were allowed.
The Tribunal decided on the issues as follows: Regarding bogus purchases (Issue 1): The Tribunal held that the assessee had discharged its onus by providing all necessary documents, including bills, confirmations, and GST details. The non-response of suppliers to Section 133(6) notices does not automatically make purchases bogus, especially when payments were made via account payee cheques and GST input credit was availed. The AO's ad-hoc disallowance was deemed unsustainable. The Tribunal relied on the principle that if the assessee provides sufficient evidence, the onus shifts, and the AO should utilize departmental machinery to verify if needed. The CIT(A)'s deletion was upheld. Regarding sale promotion expenses and foreign travel expenses (Issue 2): The Tribunal referred to its earlier decision in a related appeal (ITA No. 2692/KOL/2025 for AY 2021-22) where it had set aside the CIT(A)'s order and directed the AO to delete the entire addition of Rs. 33,63,43,852/- concerning sale promotion expenses and the entire addition of Rs. 7,52,011/- concerning foreign travel expenses. Therefore, the grounds related to these issues were allowed. Operative direction: The orders of the CIT(A) were set aside, and the AO was directed to delete the additions.
The Tribunal held that the proceedings initiated under Section 147 read with Section 148 of the Income Tax Act, 1961, and the consequent assessment order are invalid and cannot be sustained. The primary reason is that the assessment was based on material found during a third-party search conducted prior to 01.04.2021. In such cases, Section 153C of the Act provides a special and exclusive machinery, which overrides Sections 147 and 148, as supported by the second proviso to Section 149(1) of the Act. The Tribunal noted that the AO failed to follow the prescribed procedure, including providing the seized documents and allowing cross-examination. The Tribunal relied on several judicial precedents, including DCIT vs. Nawal Kumar Kanodia, Sri Dinakara Suvarna vs. DCIT, Shyam Sunder Khandelwal vs. ACIT, and Sejal Jewellary vs. Union of India, to quash the reassessment proceedings. Furthermore, the Tribunal found that even on merits, the assessee had a strong case, as the seized documents did not name the assessee, nor did the third party's statements mention the assessee, and crucial evidence was withheld. Therefore, the appeal was allowed on both legal and merit grounds.
The Tribunal held that the additions made by the AO were based on the assessee's books of accounts and other evidences furnished by the assessee, not on any incriminating material found during the search on the Surana Group. The Tribunal noted that the assessments for the impugned assessment years had already attained finality and had not abated. Relying on the Supreme Court's decision in PCIT v. Abhisar Buildwell P. Ltd. and the Calcutta High Court's decision in PCIT Vs. Sri Shanti Kumar Surana (which followed Abhisar Buildwell), the Tribunal held that in cases of unabated and completed assessments, additions can only be made if there is incriminating material unearthed during the search. Since no such material was found concerning the additions in question, the AO lacked jurisdiction to make them under Section 153C/153A. Consequently, the Tribunal set aside the order of the CIT(A) and directed the AO to delete the additions. The appeals of the assessee were allowed.
The Tribunal decided on the issues as follows: Regarding bogus purchases (Issue 1): The Tribunal held that the assessee had discharged its onus by providing all necessary documents, including bills, confirmations, and GST details. The non-response of suppliers to Section 133(6) notices does not automatically make purchases bogus, especially when payments were made via account payee cheques and GST input credit was availed. The AO's ad-hoc disallowance was deemed unsustainable. The Tribunal relied on the principle that if the assessee provides sufficient evidence, the onus shifts, and the AO should utilize departmental machinery to verify if needed. The CIT(A)'s deletion was upheld. Regarding sale promotion expenses and foreign travel expenses (Issue 2): The Tribunal referred to its earlier decision in a related appeal (ITA No. 2692/KOL/2025 for AY 2021-22) where it had set aside the CIT(A)'s order and directed the AO to delete the entire addition of Rs. 33,63,43,852/- concerning sale promotion expenses and the entire addition of Rs. 7,52,011/- concerning foreign travel expenses. Therefore, the grounds related to these issues were allowed. Operative direction: The orders of the CIT(A) were set aside, and the AO was directed to delete the additions.
The Tribunal held that the reopening of assessment under Section 147/148 was invalid. The primary reason for reopening was the alleged bogus purchases of Rs. 3,50,00,000/-, which was the subject of the notice under Section 148A(d). When the CIT(A) deleted this addition, the very foundation of the reopening was demolished. Consequently, any other additions made by the AO, including the Rs. 5,63,75,000/- on account of share sales, were rendered without valid jurisdiction. Furthermore, the Tribunal found that since the search on the third party, Anil Kumar Kasera, occurred prior to 01.04.2021, and incriminating material was found, the AO was duty-bound to initiate proceedings under Section 153C of the Act, not Section 147/148. The Tribunal relied on the decisions in ACIT vs. Gopal Prasad Gupta and Paras Chandreshbhai Koticha. Accordingly, the notice issued under Section 148 and the assessment framed under Section 147 were quashed. The assessee's appeal was allowed, and the revenue's appeal was dismissed as infructuous.
The Tribunal held that the revisionary jurisdiction exercised by the PCIT under Section 263 of the Income Tax Act, 1961, was invalid. The Tribunal found that the AO had conducted a specific inquiry into the donation expenditure by issuing a notice under Section 142(1) and had accepted the assessee's detailed explanation. The assessee had explained that the donation of ₹12,35,00,000/- to GD Charitable Society was for the welfare of Home Bidi Rollers, which was considered a business expenditure for employee welfare, especially during the COVID period. The Tribunal noted that the AO had taken a possible view by allowing this expenditure after detailed inquiry. Relying on the decisions in CIT vs. Gabriel India Ltd., PCIT vs. Kesoram Industries Limited, PCIT vs. Britannia Industries Limited, and Malabar Industrial Co. Ltd. vs. CIT, the Tribunal held that where the AO has taken one of the possible views, the revisionary jurisdiction under Section 263 cannot be invoked. The Tribunal also noted that the assessee had offered no objection to disallowing the donation of ₹2,36,05,000/- during rectification proceedings. Consequently, the revisionary order passed by the PCIT was quashed, and the appeal of the assessee was allowed.
The Tribunal held that the reopening of assessment under Section 147/148 was invalid. The primary reason for reopening was the alleged bogus purchases of Rs. 3,50,00,000/-, which was the subject of the notice under Section 148A(d). When the CIT(A) deleted this addition, the very foundation of the reopening was demolished. Consequently, any other additions made by the AO, including the Rs. 5,63,75,000/- on account of share sales, were rendered without valid jurisdiction. Furthermore, the Tribunal found that since the search on the third party, Anil Kumar Kasera, occurred prior to 01.04.2021, and incriminating material was found, the AO was duty-bound to initiate proceedings under Section 153C of the Act, not Section 147/148. The Tribunal relied on the decisions in ACIT vs. Gopal Prasad Gupta and Paras Chandreshbhai Koticha. Accordingly, the notice issued under Section 148 and the assessment framed under Section 147 were quashed. The assessee's appeal was allowed, and the revenue's appeal was dismissed as infructuous.