ITAT Mumbai Judgments — March 2025

The Tribunal held that the reassessment proceedings and additions made were invalid as they lacked a live link to the reasons recorded for reopening and were not based on any incriminating material found during the search. The assessment order was also found to be passed mechanically with factual inaccuracies.

The Tribunal held that foreign exchange gains/losses and reversals of provisions for leave encashment and gratuity should be treated as operating items. It also directed the deletion of additions related to the non-charging of interest on overdue receivables, as the assessee did not charge interest to associated enterprises or non-associated enterprises.

The Tribunal held that dismissing an appeal without deciding on merits, especially when the assessee failed to appear or comply, violates principles of natural justice. While the assessee has a duty to comply, the appellate authority must decide on merits. The order of CIT(A) was set aside for fresh adjudication.

The Tribunal held that the reassessment order and the additions made were unsustainable in law due to lack of nexus between the reasons recorded for reopening and the additions made. Furthermore, for other assessment years, additions were made based on Section 153A without any incriminating material found during the search.

The Tribunal held that the reopening of assessment and the additions made were invalid and unsustainable. The additions lacked nexus with the reasons recorded for reopening, and the assessment order was passed mechanically without application of mind. Furthermore, for assessment years 2012-13 to 2016-17, additions made under Section 153A were not based on any incriminating material found during the search.

The Tribunal allowed the withdrawal of the appeal. The grounds raised by the assessee were dismissed as withdrawn.

The Tribunal, considering the submissions and the letters filed by both the assessee and the revenue, dismissed both appeals as withdrawn. A liberty was granted to revive the appeals if the DTVSV application does not materialize.

The Tribunal allowed the assessee to withdraw the appeal, with liberty to recall if circumstances warranted. Consequently, the grounds raised were dismissed as withdrawn, and the appeal was dismissed.

The Tribunal noted that the assessment and appellate orders were passed ex-parte. While acknowledging the assessee's failure to appear, the Tribunal granted one more opportunity in the interest of natural justice, but imposed a cost of Rs. 10,000/- on the assessee. The issues were remitted to the CIT(A) for adjudication on merits.

The Tribunal held that the reopening of assessment u/s 147 was invalid as the additions made had no nexus with the reasons recorded for reopening. For the assessments u/s 153A, the Tribunal held that the additions were not based on any incriminating material found during the search and seizure operation and were therefore unsustainable.

The Tribunal held that the reassessment proceedings u/s 147 were invalid as the additions made had no nexus with the reasons recorded for reopening. For assessment years under section 153A, the additions were unsustainable as they were not based on any incriminating material found during the search.

The Tribunal held that Section 249(4)(b) is applicable only when there is an obligation to pay advance tax. Since the assessee had a net loss in the preceding financial year, there was no obligation to pay advance tax, and thus the CIT(A)'s dismissal on technical grounds was incorrect.

The Tribunal held that the assessee was not granted adequate opportunity to present their case before the CIT(A), and the CIT(A) merely reiterated the AO's findings without independent analysis. Therefore, the matter was set aside.

The Tribunal noted that the assessee was not granted a proper opportunity of being heard and that the CIT(A)'s decision appeared to be made without proper inquiry. In the interest of justice, the Tribunal remitted the issue back to the CIT(A) to pass a detailed order on merits.

The Tribunal condoned the delay of 137 days by relying on the Supreme Court judgment in Collector, Land Acquisition Vs. Mst. Katiji and Ors. The issues raised in both appeals were restored back to the file of the CIT(A) for fresh adjudication on merits.

The Tribunal condoned the delay of 475 days in filing the appeal, emphasizing the principle of advancing substantial justice over technicalities, citing various Supreme Court and High Court pronouncements. On the merits of the case, the Tribunal noted that lower authorities had not considered relevant CBDT circulars and directed the Assessing Officer to re-verify the demonetised cash deposits, requiring the assessee to furnish PAN and KYC details of all depositors.

The Tribunal found that the AO did not conduct independent verification and relied solely on the Investigation Wing report. The CIT(A) also failed to adjudicate the issue properly. The matter was remitted to the AO for fresh adjudication.

The Tribunal held that the reasons recorded for reopening the assessment were factually incorrect, as the assessee had earned short-term capital gains which were duly disclosed. Since the assessment was framed at the original returned income and there was no escapement of income, the assessment order was quashed.

The assessee has filed an application under the Vivad-Se-Vishwas Scheme, 2024 (VSVS, 2024). As the assessee opted to settle the dispute under VSVS, 2024, the appeal was dismissed as withdrawn.

The Tribunal held that the AO's ad hoc attribution of income to the PE was not sustainable as it lacked a proper Functions, Assets, and Risks (FAR) analysis and was not based on the ALP principle. The Tribunal found that the major deliverables were prepared in Italy, and the Indian PE had a limited role of providing on-site technical assistance.

The Tribunal held that the reopening of assessment u/s 147 was invalid as the additions made had no nexus with the escaped income identified in the reasons recorded. Furthermore, for assessment years 2012-13 to 2016-17, assessments u/s 153A were found unsustainable as they were not based on any incriminating material found during the search operation.

The Tribunal found that the CIT(A) had not decided the ground of appeal concerning the levy of interest under Section 234B. Therefore, the matter was set aside to the CIT(A) for fresh adjudication on this specific issue.

The Tribunal held that the assessee failed to furnish a return of income without reasonable cause, attracting Explanation 3 to Section 271(1)(c), deeming it a case of concealment. The penalty initially levied was sustained to the extent of Rs. 6,53,800/-.

The Tribunal held that the reassessment notice issued under section 148 of the Income Tax Act was invalid as it was issued beyond the period of limitation prescribed under the new law, even considering the relaxation provided by TOLA and the judicial pronouncements.

The Tribunal condoned the delay in filing the appeal, acknowledging the sufficient cause presented. Subsequently, based on the assessee's submission about the Vivad se Viswas Scheme, the appeal was dismissed as withdrawn.

The Tribunal noted that the assessee had submitted that the appeal be treated as withdrawn due to the application filed under the DTVSV scheme. Consequently, the appeal was dismissed as withdrawn.

The Tribunal admitted additional evidence from the assessee regarding fixed deposits and the affidavit concerning cash deposits. It remanded the issues of unexplained fixed deposits (Section 69), unexplained cash deposits (Section 69A), and unexplained investment in the flat (Section 69) back to the Assessing Officer for fresh examination and verification, citing a lack of proper inquiry and cryptic order by the CIT(A) for the flat investment. The ground regarding the non-issue of notice under Section 143(2) was left open, and both appeals were allowed for statistical purposes.

The Tribunal dismissed grounds 1 to 5 of the Revenue's appeal as they did not arise from the lower authorities' orders. Regarding ground 6, concerning the disallowance under Section 14A, the Tribunal followed previous decisions of the co-ordinate bench and its own orders, holding that Section 14A is not applicable to insurance companies.

The Tribunal condoned the 137-day delay in filing the appeals, citing the principle of substantial justice over technical considerations. The appeals were set aside and restored to the file of the CIT(A) for fresh adjudication on merits, with directions for the Assessee to cooperate and be vigilant in proceedings.

The Ld. Commissioner of Income Tax (Appeals) deleted the addition, finding that the Assessee had prima facie discharged its onus under Section 68 by providing sufficient evidence that the AO failed to rebut. The Income Tax Appellate Tribunal upheld this decision, concluding that the Assessee proved the identity, creditworthiness, and genuineness of the transactions and that the addition was unsustainable.

The Tribunal held that the reopening was based on suspicion rather than concrete reasons to believe income had escaped assessment, and that the disallowance of the loss was not supported by adverse evidence. The trades were found to be genuine, facilitated by BSE incentive schemes.

The Tribunal noted the submissions and letters filed by both the assessee and the revenue for withdrawal of their respective appeals. Consequently, both appeals were dismissed as withdrawn.

The Tribunal held that the penalty was wrongly levied. It found that the appellant's mistake in revising the return was bonafide, as he relied on the TDS Traces portal and his tax representative's advice. Full taxes were paid on the additional income.

The Tribunal held that both the lower authorities failed to properly evaluate the issue and were swayed by the Investigation Wing's report. The CIT(A) also failed to adhere to the provisions of Section 250 of the Act regarding stating reasons for the decision.