ITAT Mumbai Judgments — August 2025

The Tribunal held that the notice under Section 148 was issued without proper sanction as required by the amended provisions of Section 151(ii). The approval was obtained from the Pr. CIT instead of the higher authorities specified. Consequently, the notice and subsequent proceedings under Section 147 were quashed.

The Income Tax Appellate Tribunal upheld the decision of the Ld. CIT(A), ruling that an appeal against an intimation order under Section 143(1)(a) is procedurally inadmissible if the assessee has not first exhausted the rectification mechanism under Section 154 of the Act. The Tribunal noted that while the merits might favor the assessee, the procedural bar made the appeal unmaintainable.

The Tribunal held that the entire transaction cannot be treated as income, but only the profit element embedded in such transactions. The CIT(A) was reasonable in restricting the disallowance to 12.5% of the purchases.

The Tribunal remanded the issue of comparability of R Systems International Ltd. to the TPO/AO for re-adjudication. Grounds related to the GST refund addition and interest under Section 234A were allowed for statistical purposes, with directions to the AO. The penalty proceeding ground was dismissed as premature.