ITAT Mumbai Judgments — October 2025

The Tribunal held that the CIT(A) erred in confirming the addition. It noted that the Tribunal had previously set aside similar orders for a group concern, and the Settlement Commission had accepted some loans as genuine. The Tribunal found no justification for the disallowance.

The Tribunal held that the PCIT erred in invoking Section 263 jurisdiction. The PCIT failed to establish that the assessment order was erroneous or prejudicial to the revenue, and did not demonstrate that the AO had failed to apply his mind. The grounds raised by the assessee were allowed.

The Tribunal held that the delay in filing Form 10B was condonable, especially since it was filed before the return of income and in line with various High Court and Tribunal decisions.

The Tribunal condoned the delay in filing the appeal. Considering the assessee's submission that they were not given a proper opportunity to explain the cash and credit entries, the matter was restored to the AO for fresh adjudication.

The Tribunal held that in the absence of incriminating material unearthed during search, additions in unabated assessment years cannot be made. Since the assessee did not represent before the lower authorities, the case was remitted to the CIT(A) for verification of legal issues and merits, with a direction to provide an opportunity of hearing.

The Tribunal held that in the absence of incriminating material found during the search, additions for unabated assessment years cannot be made. The appeals were remitted to the CIT(A) for fresh adjudication, considering the legal issues and verifying the presence of incriminating materials.

The Tribunal held that the PCIT failed to satisfy the twin conditions required for invoking Section 263 jurisdiction. The PCIT did not specify how the Assessing Officer's order was erroneous, nor did they adequately deal with the assessee's contentions. Therefore, the PCIT's order was set aside.

The Tribunal noted that the assessee had not represented themselves before the lower authorities. However, it agreed with the assessee's contention that additions under Section 153A for unabated years require incriminating material found during the search. The Tribunal remitted the appeals for assessment years 2010-11 to 2015-16 back to the CIT(A) for verification of incriminating materials and adjudication of legal issues.

The Tribunal found that while the assessee claimed to be a joint owner for convenience, she failed to substantiate the source of Rs. 20,00,000/- in her name. However, considering the peculiar facts and the lack of clarity on her husband's case, the Tribunal remanded the issue back to the AO for fresh verification.

The Tribunal condoned the delay subject to a cost of Rs. 5,000/- to the Maharashtra Legal Aid Cell. On merits, the Tribunal directed the AO to verify if the interest/dividend was from co-operative societies, in which case it would be eligible for deduction under Section 80P(2)(d). If from banks, it would be treated as 'Income from other sources'.

The Tribunal condoned the delay in filing the appeals, subject to a cost of Rs. 5,000/- to the Maharashtra Legal Aid Cell, noting no malafide intention from the assessee. The issue of disallowance of interest earned from fixed deposits with cooperative societies/banks was then considered on merits.

The Tribunal noted that for unabated assessment years, additions under Section 153A require incriminating material found during search. Since the assessee did not produce evidence before lower authorities, the case is remitted to CIT(A) for verification of evidence and legal issues. For AY 2016-17, the appeal is also remitted for verification.

The Tribunal held that the differential amount between the stamp duty value and the sale consideration was not more than the 10% "safe harbour" tolerance limit, which is applicable retrospectively. Therefore, the benefit of this limit could not be denied to the Assessee.

The Tribunal held that the reassessment notice for AY 2015-16 was barred by limitation as it was issued after the expiry of the old limitation period and the new provisions are not retrospective. For AY 2014-15, the Tribunal upheld the CIT(A)'s order which sustained an addition at 2% of disputed purchases, finding the assessee's evidence of purchases to be substantiated.

The Tribunal noted that the assessee did not represent before the lower authorities, leading to ex-parte orders. The Tribunal remitted the appeals for assessment years 2010-11 to 2015-16 back to the CIT(A) to adjudicate the issue of incriminating material. For assessment year 2016-17, the appeal was also remitted for verification of evidence.

The Tribunal observed that the CIT(A) had himself re-computed a loss for AY 2018-19. It agreed with the assessee that a correct application of the percentage completion method, factoring in all direct and indirect project costs up to the completion, would result in a loss for both assessment years. The Tribunal concluded that the additions made by the Assessing Officer and partially sustained by the CIT(A) were not justified and should be deleted.

The Tribunal held that the delay in filing the appeal was unintentional and beyond the control of the assessee, and that the expression "sufficient cause" for condonation should be interpreted liberally to advance substantial justice. The Tribunal condoned the delay.

The Tribunal held that the CIT(A) missed certain factual aspects in re-computing profits and agreed with the assessee's counsel that factual aspects ought to be considered. The correct position revealed a loss scenario for both assessment years.

The Tribunal condoned the delay on payment of Rs. 5,000/- to the Maharashtra Legal Aid Cell, finding the delay to be due to unavoidable circumstances. On merits, the Tribunal directed the AO to verify interest/dividend income from cooperative societies for deduction under Section 80P(2)(d), referencing a Supreme Court judgment.

The Tribunal held that the reassessment notice for AY 2015-16 was barred by limitation as it was issued after the expiry of the period under the old law and the amended law, including the extended period, could not be applied retrospectively. For AY 2014-15, the Tribunal found that the purchases were substantiated with documentary evidence and upheld the CIT(A)'s decision to tax only the profit element at 2%.

The Tribunal held that the PCIT's revisionary order was not justified. It noted that the issue of allowing 80G deduction for donations made as CSR expenses is a settled matter, with various judicial precedents supporting the assessee's claim. The Tribunal found that the Assessing Officer had made proper inquiries and taken a plausible view, fulfilling the requirement of examination.

The Tribunal held that the interest income earned by a cooperative society on its investments held with a cooperative bank is eligible for deduction under Section 80P(2)(d) of the Act, following various High Court and ITAT decisions. The AO erred in disallowing the deduction.

The Tribunal ruled that the Assessing Officer had conducted a thorough inquiry into the ESOP deduction claim. It clarified that the alleged 'recovery' was merely TDS funding, not a reimbursement of ESOP cost. The Tribunal held that the PCIT's revisional order under Section 263 was unsustainable as the original assessment was neither erroneous nor prejudicial to the revenue, affirming that ESOP discount is an allowable business expenditure under Section 37(1).

The Tribunal noted that the assessee failed to provide necessary documentation to substantiate their claim regarding the interest income and the deduction. The lower authorities also could not properly adjudicate the issue due to lack of evidence.

The Tribunal noted that the assessee did not represent before the lower authorities and raised legal contentions for the first time. For assessment years 2010-11 to 2015-16, the Tribunal remitted the appeals to the CIT(A) to decide the issue of incriminating material and other legal propositions. For assessment year 2016-17, the appeal was also remitted for verification.

The Tribunal held that penalty cannot be levied on an addition made on an estimate basis when the assessee voluntarily disclosed additional income to buy peace. The penalty order was directed to be deleted.

The Tribunal condoned a delay of 13 days in filing the appeal. Considering the assessee's explanation and affidavit regarding unintentional non-submission of supporting documents due to staff oversight, the Tribunal set aside the CIT(A)'s order and restored the issue to the Assessing Officer for fresh adjudication.

The Tribunal condoned the delay of 1312 days subject to a cost of Rs. 55,000/- to be deposited by the assessee. On merits, the Tribunal found that the issues required further adjudication and therefore, remanded the case back to the Assessing Officer.

The Tribunal held that the Ld. CIT(E) was not justified in rejecting the application. The application of funds within India in Indian Rupees, even if for studies abroad, is considered application in India. The Tribunal relied on judicial precedents that state that the location of expenditure is key, not necessarily where the ultimate beneficiaries study. The assessee's submission and resolution to amend the trust deed to clarify this further were also considered.

The Tribunal held that the assessee had indeed filed a return of income in response to the notice under Section 148, which was not considered by the AO or the CIT(A). Therefore, the Tribunal found that the CIT(A) erred in dismissing the appeal. The matter was remitted to the AO for fresh adjudication.

The Tribunal held that the application of income for studies abroad by beneficiaries does not amount to application of income outside India by the trust itself, especially when the funds are disbursed in India. The Tribunal noted that the CIT(E) did not record any adverse findings on the genuineness of the trust's activities.

The Tribunal held that the claim of the revenue regarding cash payment over and above the agreement value was not tenable, especially considering the stamp duty valuation of the property and the fact that the entire payment was made by cheque. The addition made by the AO was deleted.

The Tribunal held that the AO's order allowing the CSR expenditure as a deduction under Section 80G was not erroneous nor prejudicial to the interest of the revenue. The Tribunal relied on various decisions of coordinate benches supporting the allowability of such deductions.

The Tribunal held that the reassessment notice for AY 2015-16 was barred by limitation as per the Supreme Court's decision in Rajeev Bansal, as it was issued after the expiry of the six-year period and the new ten-year period applied prospectively. For AY 2014-15, the Tribunal upheld the CIT(A)'s order, finding that the purchases were substantiated by evidence and only a profit element could be taxed.

The Tribunal held that the Assessee's application for registration under Section 12A was not belated, considering the timelines of their activities and provisional registration. Consequently, the impugned orders were set aside.

The Tribunal noted that assessment years 2010-11 to 2015-16 fall within the search period, while 2016-17 is the year of the search. Since the assessee did not appear before the lower authorities, the Tribunal remitted the appeals back to the CIT(A) for verification of the grounds raised, especially regarding incriminating material and other legal contentions.

The Tribunal held that the filing of Form 10IC is directory and delay in filing is condonable, citing various High Court and Tribunal decisions. The assessee's oversight was not a fault preventing the benefit.

The CIT(A) affirmed the addition but reduced it to Rs. 6,93,095/-, considering the cash balance on 08.11.2016 and the SBN deposits made during demonetization. The Tribunal agreed with the CIT(A)'s findings after independent verification.