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The Tribunal held that the additions made by the AO and sustained by the CIT(A) were not maintainable. The Tribunal noted that the AO primarily relied on perceived variations in trends between assessment years, which at best could raise suspicion but not constitute sufficient reason to deem cash sales prior to demonetization as bogus. The Tribunal referred to a coordinate bench decision in M/s Motor Fab Sales Pvt. Ltd. vs. The DCIT/ACIT, which held that if no defects are found in purchases or stocks, sales made from those stocks cannot be disbelieved, and consequently, cash deposits from such sales cannot be treated as unexplained. The Tribunal further noted that the CIT(A) had satisfied himself that the AO had not found any mistakes in the assessee's accounts justifying the addition and that increased sales had not declined post-demonetization. Regarding the 'Rehan' business, the Tribunal found that the CIT(A) was satisfied that the business existed and that advances were recoverable. The Tribunal concluded that once the assessee showed advances as recovered, this could not be disbelieved solely for failure to file details of some parties. Therefore, the additions sustained by the CIT(A) were deleted, and the orders to the extent of additions deleted by the CIT(A) were sustained.
The Tribunal noted that the assessee's appeal before the CIT(A) was dismissed ex parte. Upon reviewing the record, the Tribunal found that certain submissions made by the assessee were not duly examined and verified by the CIT(A), and the appeal was dismissed without affording adequate and reasonable opportunity to the assessee. The Tribunal observed that on certain occasions, the time afforded to the assessee for responding was less than a week. Therefore, considering the totality of the facts, the Tribunal set aside the impugned order of the CIT(A) and restored the grounds of appeal to the file of the CIT(A). The CIT(A) was directed to decide the grounds afresh after duly considering the submissions and evidences furnished by the assessee. The assessee was also directed to cooperate in the proceedings and not seek adjournments without compelling exigency. The grounds raised in the appeal were allowed for statistical purposes. The principle derived is that an appellate authority must provide a reasonable opportunity of being heard and duly examine the submissions and evidence before dismissing an appeal ex parte.
The Tribunal noted that the assessment order was passed ex parte, and the assessee raised specific and material objections regarding the bank accounts considered by the AO, stating they either did not belong to the assessee or were not from the relevant assessment year. The assessee claimed actual deposits pertaining to him were Rs. 1,13,27,600, representing business sale proceeds and realizations, duly recorded in books and supported by documentary evidence. The Tribunal found substance in the assessee's contention that the assessment was completed ex parte and that there was a dispute regarding the proper service of statutory notices. Given the assessee's willingness to produce documentary evidence before the Tribunal, the Tribunal held that the ends of justice would be met by providing one effective opportunity to the assessee before the Assessing Officer. Therefore, the impugned order was set aside, and the assessment was restored to the file of the Assessing Authority for de novo assessment in accordance with law. The grounds raised were allowed for statistical purposes.
The Tribunal dismissed the appeal for want of prosecution. It noted that the assessee did not appear for the hearing despite multiple opportunities. The Tribunal observed that the AO made an addition of Rs. 3,04,01,055/- under Section 68 of the IT Act, 1961, as the assessee could not explain the source of cash credits. The appellate authority sustained this addition. The Tribunal found no submissions or material presented by the assessee to rebut the findings of the CIT(A). The Revenue's representative supported the lower authorities' orders. The Tribunal presumed the assessee was not interested in prosecuting the appeal. The appeal was dismissed accordingly. The assessee was granted liberty to approach the Tribunal for recalling the order upon demonstrating sufficient cause for non-appearance. The issue regarding jurisdiction of notices was not decided on merits due to the dismissal for want of prosecution.
The Tribunal condoned the delay of 669 days in filing the appeal, accepting the assessee's submission that it was due to a bona fide and unavoidable heart-related illness and treatment. The Tribunal noted that the assessee had failed to provide any explanation or documentary evidence regarding the cash deposits and insurance commission before the AO and CIT(A). However, considering the assessee's willingness to ensure compliance if the matter was restored to the AO, the Tribunal decided to restore the matter back to the file of the AO for a denovo assessment. The Tribunal directed the assessee to ensure compliance before the AO. The specific findings on the validity of reopening under Section 147, the addition under Section 69A, the charging of interest under Sections 234A, 234B, and 234C, and the initiation of penalty proceedings under Sections 271AAC and 270A were not adjudicated on merits, as the appeal was allowed for statistical purposes with a direction for denovo assessment. The ratio decidendi is that in cases of significant delay, if the assessee shows willingness to comply and the matter can be effectively adjudicated denovo, the Tribunal may restore the case to the AO.
The Tribunal held that the impugned penalty proceedings were initiated based on an incorrect appreciation of facts, without duly verifying the actual nature and mode of receipt of sale consideration. The assessee had placed documentary evidence, including a certificate from the purchaser (M/s. Manas India Projects Pvt. Ltd.), confirming that Rs. 12,74,100/- remained outstanding and was subsequently paid through banking channels. The Revenue failed to produce any cogent material to rebut this evidence or establish that the amount was indeed received in cash. The AO had accepted that a major portion of the sale consideration was received through banking channels and ought to have inquired about the outstanding sum from the seller, which was not done. Therefore, in the absence of material evidence clearly establishing a cash transaction for the disputed amount, the penalty under section 271D could not be sustained. The Tribunal directed the AO to delete the penalty of Rs. 12,74,100/-. The grounds raised in the appeal were allowed.
The Tribunal decided on several issues. Regarding the addition of Rs. 4,36,954/- on account of commission income from M/s Bajaj Finance Ltd., the Tribunal found that this income was not reflected in the profit and loss account, despite the assessee claiming it was shown under 'incentive scheme'. As the assessee could not reconcile the accounts, the addition was confirmed. Concerning the addition of Rs. 3,60,000/- for salary to a partner, the Tribunal noted that a supplementary partnership deed dated 01.04.2013 had been examined by the AO in AY 2014-15 and the remuneration was allowed. Therefore, there was no reason for a departure in AY 2015-16, and the addition sustained by the CIT(A) was not maintainable. On showroom renovation expenditure of Rs. 18,38,594/-, the Tribunal, relying on ITAT Ahmedabad's decision in DCIT vs. Torque Automative Pvt. Ltd. and Supreme Court's decision in CIT vs. Associated Cement Co. Ltd., held that the expenditure was revenue in nature as it was not intended to provide an enduring benefit but to meet specific requirements of companies whose products the assessee distributed. The addition was deleted. Regarding the disallowance of Rs. 9,71,410/- for AC installation, the Tribunal observed that the disallowance was based on a misunderstanding; as these were concessional incentives for sales made to customers' residences, they constituted allowable business expenses and the addition was deleted. The ad-hoc disallowance of 5% on various maintenance expenditures was also deleted, as these were normal business expenses and nothing suggested they were not incurred. A 20% disallowance on vehicle running expenses was deleted for lack of evidence of personal use, especially as payments were made through banking channels. The Tribunal upheld the disallowance of Rs. 39,016/- under Section 40A(3) as the assessee could not deny the cash payment. The Tribunal expressly left undecided the grounds related to penalty proceedings and interest levies, as they were not decided by the CIT(A).
The Tribunal held that the additions made by the AO and sustained by the CIT(A) were not maintainable. The Tribunal noted that the AO primarily relied on perceived variations in trends between assessment years, which at best could raise suspicion but not constitute sufficient reason to deem cash sales prior to demonetization as bogus. The Tribunal referred to a coordinate bench decision in M/s Motor Fab Sales Pvt. Ltd. vs. The DCIT/ACIT, which held that if no defects are found in purchases or stocks, sales made from those stocks cannot be disbelieved, and consequently, cash deposits from such sales cannot be treated as unexplained. The Tribunal further noted that the CIT(A) had satisfied himself that the AO had not found any mistakes in the assessee's accounts justifying the addition and that increased sales had not declined post-demonetization. Regarding the 'Rehan' business, the Tribunal found that the CIT(A) was satisfied that the business existed and that advances were recoverable. The Tribunal concluded that once the assessee showed advances as recovered, this could not be disbelieved solely for failure to file details of some parties. Therefore, the additions sustained by the CIT(A) were deleted, and the orders to the extent of additions deleted by the CIT(A) were sustained.
The Tribunal permitted the appeal to be withdrawn and dismissed as such. The assessee's authorized representative, on the date of hearing, submitted an application on behalf of the Secretary of the assessee society stating that the management had decided not to pursue the appeal. Consequently, the appeal was not being pressed. The Revenue's representative had no objection to the withdrawal of the appeal. In consideration of these submissions, the appeal was permitted to be withdrawn and dismissed. The Tribunal did not decide on the merits of the grounds raised by the assessee. The operative direction was to dismiss the appeal as withdrawn.
The Tribunal held that the learned CIT(A) had erred in dismissing the appeal on the grounds of delay without proper application of mind and by mechanically rejecting the condonation application. The Tribunal noted that the assessee had provided reasons for the delay, and the CIT(A) failed to consider these reasons adequately. The Tribunal found that the CIT(A) had not appreciated the detailed submissions made by the assessee regarding the nature of the transactions and the fact that the property purchase was made by a separate legal entity, M/s Signature Property Projects P. Ltd., where the assessee was a director and authorized signatory. The Tribunal concluded that the CIT(A) had failed to address the substantive grounds of appeal concerning the merits of the additions made by the AO. Therefore, the order of the CIT(A) was set aside, and the case was remanded back to the CIT(A) for fresh adjudication on merits after considering the condonation application and the grounds of appeal.
The Tribunal noted that the assessee had filed an application for withdrawal of the appeal. The assessee's counsel submitted that the present appeal (ITA No. 600/LKW/2026) was a duplicate filing, erroneously registered due to a technical error on the ITAT e-filing portal. The same email address, when entered in different cases (lower case vs. upper case), resulted in two separate user registrations and consequently, a duplicate appeal. The assessee had already filed a valid and correct appeal (ITA No. 542/LKW/2026) for the same assessee, subject matter, and assessment year. Therefore, the assessee prayed for the withdrawal of the present appeal. The Revenue's counsel had no objection to the withdrawal. The Tribunal, in light of the facts and circumstances narrated by the assessee's counsel, permitted the appeal (ITA No. 600/LKW/2026) to be withdrawn and treated it as dismissed as withdrawn. Consequently, the appeal of the assessee was dismissed.
The Tribunal held that the issue concerning manufacturing/quantitative analysis requires fresh adjudication. While the assessee's declaration during the survey and the AO's analysis constitute material, the assessee's alternative quantitative working and calculation errors pointed out by the assessee cannot be ignored. Given the technical nature involving manufacturing processes, raw material consumption, veneer requirements, labour, and man-hours, an objective determination with the assistance of a technical expert is necessary. Therefore, the matter is restored to the file of the CIT(A) for fresh adjudication. The CIT(A) is directed to call for a comprehensive remand report from the AO covering manufacturing analysis, quantitative calculations, labour/man-hours, AO's assumptions, assessee's objections, and alternative working. The AO shall obtain expert assistance from the Institute of Wood Science and Technology (IWST) for technical aspects. The CIT(A) will then adjudicate the appeal afresh based on the remand report, expert opinion, assessee's objections, and other material, considering the diary entries and statements cumulatively with the expert findings. The issue of diary fabrication is considered final and not to be reopened. The appeal is allowed for statistical purposes.
The Tribunal condoned the 417-day delay in filing the appeal, subject to the assessee paying Rs. 20,000/- as cost to the PM National Relief Fund. Regarding the substantive issues, the Tribunal noted that the assessee filed the return under Section 139(4) on 31/03/2022, and the audit report in Form 10B was filed on 23/03/2023. Citing a coordinate bench decision in ITA No. 3784/Del/2024 and CBDT Circular No. 17/2021, the Tribunal held that the delay in filing Form 10B is a curable defect. They also confirmed that the return was filed within the time limit prescribed for a belated return. Since these aspects were not considered by the Ld. Addl/Jt. CIT(A) due to the assessee's non-compliance, the Tribunal restored the matter to the file of the Ld. Addl/Jt. CIT(A) with a direction to decide the issue afresh after considering the audit report in Form 10B as valid, having condoned the delay in its filing. The Tribunal did not decide the merits of the claim for exemption under Section 11 or the allowability of revenue expenditure, as these were to be adjudicated by the lower appellate authority.
The Tribunal held that once the assessee has raised a specific claim before the appellate authorities and has placed supporting material on record, the claim requires examination on its factual and legal merits. The Tribunal noted that the mere fact that the claim was not reflected in the relevant column of the original return does not, in the facts and circumstances, obviate the requirement of examining the underlying claim and supporting evidence. The Tribunal observed that the merits of the assessee's entitlement to exemption had not been examined in detail by the lower authorities. In the interest of substantial justice, the Tribunal restored the matter to the file of the Assessing Officer for fresh examination of the assessee's claim for exemption of Rs.10,00,000/- towards gratuity under section 10(10) and Rs.3,00,000/- towards leave encashment under section 10(10AA). The Assessing Officer is to consider the relevant statutory provisions and documentary evidence, including Form No.16. The Tribunal explicitly stated that it had not expressed any opinion on the ultimate allowability of the exemptions and that the Assessing Officer shall adjudicate independently. The order of the CIT(A) was set aside to this extent.
The Tribunal held that the matter required fresh examination by the CIT(E) as crucial documents, including OTS documents, correspondence with the bank, SARFAESI Act notices, financial assistance details from specified persons, confirmations, bank statements, fund-flow statements, and books of account, were not before the CIT(E). The Tribunal observed that while the CIT(E) noted substantial loans and advances and borrowings from trustees, the assessee's explanation regarding the use of these funds for settling bank liabilities and the introduction of personal funds by trustees to protect the institution needed verification. The Tribunal clarified that the introduction of personal funds by specified persons to protect the institution, if verified, would not constitute a valid ground for denial of registration. It also noted the assessee's submission that advances were interest-free, which was significant. The Tribunal set aside the impugned order and restored the matter to the CIT(E) for a fresh, reasoned, and speaking order after affording an adequate opportunity of hearing and examining all submitted documents. The Tribunal explicitly stated that it had not expressed any opinion on the merits of the controversy.
The Tribunal held that the matter required fresh examination by the CIT(E) as crucial documents, including OTS documents, correspondence with the bank, SARFAESI Act notices, financial assistance details from specified persons, confirmations, bank statements, fund-flow statements, and books of account, were not before the CIT(E). The Tribunal observed that while the CIT(E) noted substantial loans and advances and borrowings from trustees, the assessee's explanation regarding the use of these funds for settling bank liabilities and the introduction of personal funds by trustees to protect the institution needed verification. The Tribunal clarified that the introduction of personal funds by specified persons to protect the institution, if verified, would not constitute a valid ground for denial of registration. It also noted the assessee's submission that advances were interest-free, which was significant. The Tribunal set aside the impugned order and restored the matter to the CIT(E) for a fresh, reasoned, and speaking order after affording an adequate opportunity of hearing and examining all submitted documents. The Tribunal explicitly stated that it had not expressed any opinion on the merits of the controversy.
The Tribunal held that the material on record was insufficient to sustain the impugned addition. The Assessing Officer relied on the statement of the proprietor of M/s Vinayak Traders, recorded behind the assessee's back, without providing an opportunity for cross-examination. The subsequent withdrawal of funds by the supplier, even if established, was a circumstance giving rise to suspicion but did not conclusively establish that the assessee's purchases were bogus or that only accommodation bills were obtained, especially without establishing a nexus with the assessee's transactions and other corroborative evidence. The Tribunal distinguished between material sufficient for reopening and material sufficient to sustain an addition. The revenue failed to bring on record independent and corroborative material or afford an effective opportunity for cross-examination. Therefore, the addition could not be sustained merely on the basis of the uncorroborated statement. The benefit of doubt was given to the assessee, and the addition was deleted. The appeal was allowed.
The Tribunal noted that the assessee's appeal before the CIT(A) was dismissed ex-parte. The Tribunal observed that while the assessee had raised substantial grounds, including jurisdictional and limitation issues, these were not appropriately adjudicated by the CIT(A) due to the assessee's non-compliance. The Tribunal also noted that the assessee's authorized representative declined to advance arguments on the merits before the ITAT, confining submissions to jurisdictional and limitation issues. The Tribunal expressed strong disapproval of the manner in which the appeal was conducted by the assessee, but considering the peculiar facts, decided not to visit the assessee with the ultimate consequence of lapse without adjudication on merits. The Tribunal found that the issues relating to jurisdiction and limitation were not appropriately adjudicated by a speaking order. Therefore, in the interest of justice and fair play, the Tribunal set aside the impugned order of the CIT(A) and restored the matter to the file of the CIT(A) for fresh adjudication on all issues, including jurisdictional/legal grounds and the merits of the additions. The CIT(A) was directed to pass a comprehensive, reasoned, and speaking order after affording adequate opportunity to both parties. The Tribunal made it clear that it had expressed no opinion on the merits of the issues.
The Tribunal held that the delay of 99 days in filing the appeal was condoned as the assessee was prevented by sufficient cause. The Tribunal found that the CIT(A) had dismissed the assessee's appeal for non-prosecution without adjudicating the substantive grounds on merits. The Tribunal noted that the grounds raised by the assessee, including the validity of reassessment proceedings under section 147 and the merits of additions under sections 68 and 69C, involved examination of facts and documents. The Tribunal reasoned that the CIT(A) was required to dispose of the grounds in accordance with law and on the basis of material available, and the assessee's failure to appear did not dispense with the need for reasoned adjudication, especially concerning jurisdictional issues. Therefore, the Tribunal set aside the impugned order and restored the matter to the file of the CIT(A) for fresh adjudication. The assessee was granted one effective opportunity to present its case. As a condition, the assessee was directed to plant 300 trees and submit a compliance report. The issues were restored to the CIT(A) for independent adjudication.
The Tribunal held that Section 115BBE is prospective in nature and does not apply to AY 2017-18, citing the decision in Deepak Maratha and concurring views of several Coordinate Benches. Consequently, Ground No. 4 of the appeal was allowed. Regarding depreciation, since the amount was declared for investment in fixed assets and capitalized, and Section 115BBE was held inapplicable for AY 2017-18, there was no reason to disallow depreciation. Therefore, Ground No. 1 was also allowed. Grounds No. 2 and 3 were considered consequential and thus allowed without separate adjudication. The appeal of the assessee was allowed in full.
The Tribunal condoned the delay of 159 days in filing the appeal, accepting the assessee's explanation regarding technical difficulties in filing on the Income Tax Portal. The Tribunal noted that the AO's order was ex parte and the NFAC had dismissed the appeal in limine for non-compliance. Considering the facts, the Tribunal was of the view that the assessee deserved one more opportunity to present its case. Therefore, the order of the NFAC was set aside, and the file was restored to the Assessing Officer. The AO was directed to provide the assessee with one more opportunity to present its case. The assessee was cautioned to fully comply with the AO's directions in the set-aside proceedings, failing which the AO would be at liberty to pass an order based on available material, even if ex parte. The appeal was allowed for statistical purposes.
The Tribunal noted that the assessee had not appeared before it, and an adjournment application was filed. The appeal was decided ex-parte. The Tribunal observed that the assessee had failed to file the return of income for the Assessment Year 2019-20. The Department had information regarding cash deposits of Rs. 36,89,132/- and interest income of Rs. 36,20,226/-. The assessment was reopened under Section 147 of the Income Tax Act, 1961. Since the assessee did not present its case or provide any explanation for the non-filing of the return or the undisclosed income, the Tribunal found no reason to interfere with the order passed by the NFAC. The appeal was dismissed for want of prosecution and on merits.
The Tribunal, after hearing both parties and perusing the record, was of the considered view that the assessee deserved one more opportunity to present his case. The Tribunal restored the file to the Assessing Officer with a direction to provide one more opportunity to the assessee to present his case and produce necessary evidence in support of the claim for exemption under section 10(38). The assessee was cautioned to fully comply with the directions of the Assessing Officer in the set-aside proceedings, failing which the AO would be at liberty to pass an order based on available material, even if ex-parte. The Tribunal allowed the appeal for statistical purposes. The specific grounds of appeal were not explicitly decided individually but were implicitly addressed by the decision to grant a fresh opportunity.
The Tribunal, while noting that none appeared for the assessee and an adjournment application was rejected, decided to grant the assessee one more opportunity in the interest of substantial justice. The Tribunal restored the file to the NFAC, Guwahati, with directions to give the assessee an opportunity to explain the delay in filing the appeal. If deemed appropriate, the delay should be condoned, and the appeal admitted for hearing on merits. The assessee was cautioned to comply with the directions, failing which the NFAC could pass an ex-parte order. The Tribunal did not decide the merits of the exemption claim under Section 10(10B) or the procedural issue of dismissal in limine, as the matter was remanded for fresh adjudication.
The Tribunal held that the addition made under Section 69 was erroneous as the transaction was recorded in the books of account and the assessee had provided evidence. It also noted that no independent inquiry was made from the lender to ascertain creditworthiness.
The Tribunal condoned the delay in filing the appeal, noting the assessee's explanation of the delay due to cessation of business and lack of administrative setup. The Tribunal observed that there was no compliance from the assessee during assessment and the NFAC dismissed the appeal for failure to produce documentary evidence. Considering the peculiar facts, the Tribunal held that the assessee deserved one more opportunity to present its case. Accordingly, the order of the NFAC was set aside, and the file was restored to the Assessing Officer with a direction to provide one more opportunity to the assessee. The assessee was cautioned to fully comply with the AO's directions, failing which the AO could pass an ex-parte order. The issue regarding the retrospective application of the 30% disallowance under section 40(a)(ia) was not expressly decided as the matter was remanded.
The Tribunal held that the CIT(A) erred in dismissing the appeals in limine. The Tribunal noted that all communications were made electronically, and there was no evidence of physical service of notices. The email IDs and mobile numbers on the income tax portal belonged to an employee and a counsel, which could reasonably explain the assessee's lack of response and the delay in filing appeals. Considering the assessee's claim of exemption under section 10(23C)(iiiab), the explanation for cash deposits from planetarium ticket sales, and fixed deposits from employee provident fund contributions, and the audit by the State Auditor General, the Tribunal restored the matter to the AO for re-examination. Consequently, ITA No. 799/LKW/2026 (related to assessment) was allowed for statistical purposes. Regarding the penalty under section 271AAC(1), the Tribunal held it was premature as the nature of deposits was yet to be enquired into. The penalty was deleted with liberty to the AO to re-initiate proceedings if warranted. ITA No. 798/LKW/2026 was allowed. Similarly, the penalty under section 272A(1)(d) was deleted as there were adequate reasons for the assessee's non-compliance and delay in filing appeals. ITA No. 797/LKW/2026 was allowed.
The Tribunal held that the assessee's claim for deduction under section 54F was not substantiated. The assessee failed to provide formal agreements with contractors, details of work assigned, or bills. No valuation of incomplete construction was provided. The delay in construction due to litigation was not a valid reason as the dispute was settled in 2013. Therefore, the purported advances of Rs. 72,52,250/- were disallowed, upholding the AO and CIT(A)'s decision. Regarding the addition under section 56(2)(vii)(b)(ii), the Tribunal held that the purchase of a flat in a multi-storey building includes the cost of the right to use common amenities, and since the cost was less than the stamp duty value, the addition of Rs. 3,95,000/- was confirmed. For the addition of Rs. 40,000/- towards household withdrawals, the Tribunal agreed with the assessee that the addition was based on suspicion without cogent material. Neither the AO nor the CIT(A) provided evidence of actual expenditure exceeding drawings or insufficient drawings. Thus, this addition was deleted. Ground 4 was dismissed as general. Ground 5 was dismissed as not pressed due to lack of evidence. The appeal was partly allowed.
The Tribunal held that the CIT(A) erred in dismissing the appeals in limine. The Tribunal noted that all communications were made electronically, and there was no evidence of physical service of notices. The email IDs and mobile numbers on the income tax portal belonged to an employee and a counsel, which could reasonably explain the assessee's lack of response and the delay in filing appeals. Considering the assessee's claim of exemption under section 10(23C)(iiiab), the explanation for cash deposits from planetarium ticket sales, and fixed deposits from employee provident fund contributions, and the audit by the State Auditor General, the Tribunal restored the matter to the AO for re-examination. Consequently, ITA No. 799/LKW/2026 (related to assessment) was allowed for statistical purposes. Regarding the penalty under section 271AAC(1), the Tribunal held it was premature as the nature of deposits was yet to be enquired into. The penalty was deleted with liberty to the AO to re-initiate proceedings if warranted. ITA No. 798/LKW/2026 was allowed. Similarly, the penalty under section 272A(1)(d) was deleted as there were adequate reasons for the assessee's non-compliance and delay in filing appeals. ITA No. 797/LKW/2026 was allowed.
The Tribunal condoned the 60-day delay in filing the appeal before the CIT(A), accepting the assessee's explanation of ignorance of the order due to counsel's failure and noting that the assessee stood to gain nothing by delaying. The Tribunal found that the CIT(A) erred in dismissing the appeal in limine. While acknowledging the assessee's lack of proper compliance during assessment, the Tribunal noted that the AO's requirements were unclear, such as asking for IT returns of suppliers or their creditworthiness when the issue was genuineness of purchases. The estimation of gross profit at 20% was deemed to lack scientific or empirical basis. The Tribunal held that small traders cannot be expected to be fully conversant with intricate electronic communication. Therefore, in the interest of justice, the matter was restored to the AO with a direction for the assessee to produce necessary evidence to demonstrate the genuineness of purchases. The AO was directed to consider this evidence and pass a fresh assessment order. The appeal was allowed for statistical purposes.
The Tribunal considered the arguments and facts. It was held that only the employee's contribution pertaining to the current assessment year could be added back to the assessee's income for this assessment year. The Tribunal noted the submission that the Rs. 7.46 crores added back was the sum total of five years of contributions, as indicated in the auditor's note. Since this aggregated amount needed verification and segregation to determine the portion disallowable for the specific assessment year under consideration, the Tribunal restored the matter back to the file of the Assessing Officer. The AO was directed to undertake this exercise, segregate the disallowable amount for AY 2015-16, and pass appropriate orders in accordance with the law. The issue of whether the original assessment order was erroneous and prejudicial to revenue was implicitly addressed by the remand, as the AO would now correctly determine the disallowance for the relevant year. The Tribunal did not expressly decide on the other grounds raised by the assessee, such as set-off of losses or charging of interest, as the primary issue of the addition was remanded.
The Tribunal considered the facts and arguments. It noted that the additions made by the AO were primarily due to the assessee's failure to make proper compliances. The assessee's explanation for this failure was the disorientation caused by multiple family deaths, including the death of their only son, which affected their business and legal compliances. The Tribunal found this to be a fit case for admitting additional evidence to allow the AO to consider all material before deciding on the additions. In the interest of justice, the Tribunal restored the matter to the file of the AO with a direction to the assessee to furnish all necessary documents and books of accounts. The AO was directed to consider the submitted material and pass a fresh assessment order. The appeal was allowed for statistical purposes. The Tribunal did not decide on the specific additions made by the AO, as the matter was remanded.
The Tribunal held that the AO made the disallowance of Rs. 1,65,20,000/- under Section 40(a)(ia), not Section 37(1). The CIT(A) erred by assuming the disallowance was under Section 37(1) without giving the assessee a proper opportunity to respond to this altered charge. The Tribunal noted that the CIT(A) did not address whether the assessee could be penalized for the recipient's failure to file a return in the correct format if the receipts were offered to tax. Consequently, the addition of Rs. 1,65,20,000/- could not be sustained. The Tribunal also found that the CIT(A) had not addressed the issues regarding salary and Chapter VI-A deductions. Therefore, the matter was restored to the file of the AO for reconsideration of these issues and to consider fresh evidence the assessee might present for salary expenses and deductions under Chapter VI-A. The AO was directed to pass a fresh order after considering the highlighted issues and presented evidence. The Tribunal did not decide the specific allowability of salary and LIC premium but remanded them for fresh adjudication.
The Tribunal considered the facts and circumstances, noting that the assessee had submitted purchase invoices, bilti, bank statements, and ledger accounts before the Assessing Officer. The assessee had also sought to introduce further evidence under Rule 46A. The Tribunal observed that the CIT(A) had not passed an order on merits. Therefore, in the interest of justice, the Tribunal deemed it appropriate to restore the matter to the file of the CIT(A) to consider the issue on its merits. The Tribunal directed the assessee to make necessary submissions to satisfy the CIT(A) regarding the genuineness of the purchases, and the CIT(A) was instructed to consider these evidences and pass a fresh order in accordance with the law. The issue of whether the purchases were bogus was expressly left undecided by the Tribunal, as the primary decision was to restore the appeal for fresh adjudication.
The Tribunal considered the assessee's submission that the sale proceeds were from a rural agricultural land, which would exempt it from tax. The assessee wished to present land records to support this claim. The Tribunal also noted that the entire sale consideration was taxed as capital gains without considering the cost of purchase. In the interest of justice, the Tribunal decided to restore the matter to the file of the Assessing Officer to provide the assessee an opportunity to present necessary evidence supporting his claims. The Tribunal cautioned the assessee that failure to comply would result in an adverse inference. The Assessing Officer was directed to consider the evidence and take a fresh decision in accordance with the law. The issue regarding the proper opportunity and jurisdiction was implicitly addressed by restoring the matter for fresh adjudication on merits.
The Tribunal held that the assessee, being an agriculturist and poorly educated, had consulted his counsel and ensured compliance initially. However, due to the AR's resignation and failure to disclose pending matters, the assessee was unaware of electronically issued notices. The Tribunal found sufficient reasons to explain the non-compliance, considering the assessee's level of education and dependence on the AR. The subsequent resignation of the AR and the assessee's lack of knowledge of the issued notices were considered sufficient grounds to explain the non-compliance. Therefore, the penalty of Rs. 20,000/- levied under section 272A(1)(d) for non-compliance with electronically issued notices was held to be unwarranted and was deleted. The appeal of the assessee was allowed.
The Tribunal held that the CIT(A) erred in dismissing the appeals in limine. The Tribunal noted that all communications were made electronically, and there was no evidence of physical service of notices. The email IDs and mobile numbers on the income tax portal belonged to an employee and a counsel, which could reasonably explain the assessee's lack of response and the delay in filing appeals. Considering the assessee's claim of exemption under section 10(23C)(iiiab), the explanation for cash deposits from planetarium ticket sales, and fixed deposits from employee provident fund contributions, and the audit by the State Auditor General, the Tribunal restored the matter to the AO for re-examination. Consequently, ITA No. 799/LKW/2026 (related to assessment) was allowed for statistical purposes. Regarding the penalty under section 271AAC(1), the Tribunal held it was premature as the nature of deposits was yet to be enquired into. The penalty was deleted with liberty to the AO to re-initiate proceedings if warranted. ITA No. 798/LKW/2026 was allowed. Similarly, the penalty under section 272A(1)(d) was deleted as there were adequate reasons for the assessee's non-compliance and delay in filing appeals. ITA No. 797/LKW/2026 was allowed.
The Tribunal held that merely because the assessee is an Advocate, it cannot be presumed he is well-versed with computers and able to respond to email notices. The Tribunal noted that the assessee did not stand to gain from the delay in filing appeals. The facts regarding the acquisition and allotment of land, which were agitated before the CIT(A) but not examined, were crucial. If the assessee could prove he received the land as compensation for land purchased in 1997, the subsequent allotment would not constitute a fresh purchase attracting section 56(2)(x), as the original transaction predated the provision. Therefore, there is a need to verify these facts. The Tribunal agreed with the revenue that the matter should be restored to the Assessing Officer for consideration of these aspects. The assessee is to furnish all relevant details, and the AO is to pass a fresh order. Consequently, ITA No. 833/LKW/2026 is allowed for statistical purposes. Regarding the penalty, the Tribunal held that it is premature to conclude under-reporting of income without ascertaining full facts. The penalty levied under section 270A is not sustainable and is deleted, with liberty to the AO to re-initiate it if, during the restored assessment, he concludes that income was under-reported. Accordingly, ITA No. 832/LKW/2026 is allowed.
The Tribunal held that merely because the assessee is an Advocate, it cannot be presumed he is well-versed with computers and able to respond to email notices. The Tribunal noted that the assessee did not stand to gain from the delay in filing appeals. The facts regarding the acquisition and allotment of land, which were agitated before the CIT(A) but not examined, were crucial. If the assessee could prove he received the land as compensation for land purchased in 1997, the subsequent allotment would not constitute a fresh purchase attracting section 56(2)(x), as the original transaction predated the provision. Therefore, there is a need to verify these facts. The Tribunal agreed with the revenue that the matter should be restored to the Assessing Officer for consideration of these aspects. The assessee is to furnish all relevant details, and the AO is to pass a fresh order. Consequently, ITA No. 833/LKW/2026 is allowed for statistical purposes. Regarding the penalty, the Tribunal held that it is premature to conclude under-reporting of income without ascertaining full facts. The penalty levied under section 270A is not sustainable and is deleted, with liberty to the AO to re-initiate it if, during the restored assessment, he concludes that income was under-reported. Accordingly, ITA No. 832/LKW/2026 is allowed.
The Tribunal held that additions to income cannot be sustained on surmises, conjectures, or misinterpretation of financial statements. The AO was not justified in treating the closing stock of Rs. 42,16,426, which was duly reflected as a current asset in the audited books of accounts, as taxable revenue solely due to an electronic data-entry mismatch in the return. The Tribunal noted that the record indicated no sales or purchase transactions during the year, implying the inventory value naturally rolled over from the preceding year. Treating stock-in-hand valuation as sales revenue without any concrete findings or corroborative material indicating suppressed sales or untraced commercial operations is impermissible. The Tribunal concluded that such an ad-hoc addition, devoid of statutory backing or factual foundation, cannot survive judicial scrutiny. Therefore, the addition of Rs. 42,16,426 made by the AO and sustained by the CIT(A) was deemed unjustified and legally unsustainable. The Tribunal ordered the deletion of the entire addition.
The Tribunal held that the Revenue failed to provide corroborative evidence for the additions. The difference in balance sheets was considered a projected balance sheet for loan purposes, not indicative of unexplained income. The donation was already accounted for in the income and expenditure account.
The Tribunal held that the disallowance of Rs.7,32,067/- made by the AO and confirmed by the NFAC was an ad-hoc disallowance. The AO had randomly disallowed 25% of the total expenses of Rs.29,28,270/- without any rationale or justification. The Tribunal noted that if an assessee fails to substantiate expenses, the AO should ideally disallow the entire expenditure, but a partial disallowance of 25% without any basis cannot be sustained. The Tribunal emphasized that expenses incurred wholly and exclusively for business purposes are allowable under section 37(1) of the Act. Disallowances cannot be made based on general observations, surmises, or absence of third-party bills without positive material proving the expenditure is bogus, inflated, or non-genuine. Suspicion cannot replace concrete evidence. Therefore, the ad-hoc disallowance was directed to be deleted in its entirety. The Tribunal did not explicitly address the grounds related to principles of natural justice and opportunity of being heard, as the core issue of the disallowance was decided on merits.
The Tribunal condoned the delay, finding sufficient cause. It held that the AO erred in invoking Section 50C without referring the matter to the DVO when the stamp duty valuation was disputed. The matter was remanded for fresh verification of the fair market value and treatment of the co-owner.
The Tribunal condoned the delay in filing the appeal due to the death of the assessee and the subsequent addition of legal heirs. The appeal was admitted for adjudication on its merits.
The Tribunal found no justification to grant further opportunities to the assessee due to the persistent defects and non-appearance. Consequently, the appeal was dismissed as defective.
The Tribunal restored the appeal to the NFAC, directing it to provide the assessee with one more opportunity to present their case. The assessee was cautioned to fully comply with the NFAC's directions in the set-aside proceedings.