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The Tribunal held that it has jurisdiction to entertain the appeal. The Revenue's contention that the appeal is not maintainable due to non-payment of admitted tax liability by the assessee under Section 245D(4) was rejected. The Tribunal reasoned that the Revenue had not filed any appeal against the order of the Settlement Commission, and therefore, the appeal before the Tribunal was maintainable. Regarding the second issue, the Tribunal found that the Assessing Officer had made an addition on account of unexplained cash credit under Section 68 without proper investigation or cogent evidence. The Tribunal observed that the assessee had provided sufficient explanation and documentary evidence to substantiate the cash credit. Therefore, the addition made by the Assessing Officer was deleted. The operative direction was the deletion of the addition made on account of unexplained cash credit.
The Tribunal held that the assessee is eligible for deduction under Section 10AA of the Act. It reasoned that while Section 10AA(1) uses the phrase 'begins to manufacture', the provisos to Section 10AA(3) and the conditions in Section 10AA(4)(i) clarify that existing SEZ units commencing manufacturing before April 1, 2006, are also eligible, subject to other conditions. The Tribunal further noted that Section 10A(7B), introduced with the SEZ Act, 2005, debarred SEZ units from Section 10A benefits, migrating them to Section 10AA for the unexpired period. The Tribunal also clarified that the assessee is eligible for deduction for the unexpired period of ten years, as per Section 10AA(1)(i) and (ii), and not the third proviso to Section 10AA(3). The Tribunal reversed the CIT(A)'s decision allowing the Section 10A claim, finding a statutory prohibition under Section 10A(7B). The AO was directed to allow deduction under Section 10AA, subject to factual verification, and withdraw any deduction granted under Section 10A. Regarding interest under Section 234C, the AO was directed to re-compute it strictly in accordance with the provisions of the Act. The Tribunal cited the ratio from Classic Linens International (P.) Ltd. vs. Dy. CIT and ITO vs. Last Peak Data (P.) Ltd. in support of its view on the duration of deduction.
The Tribunal held that the assessee is eligible for deduction under Section 10AA of the Act. It reasoned that while Section 10AA(1) uses the phrase 'begins to manufacture', the provisos to Section 10AA(3) and the conditions in Section 10AA(4)(i) clarify that existing SEZ units commencing manufacturing before April 1, 2006, are also eligible, subject to other conditions. The Tribunal further noted that Section 10A(7B), introduced with the SEZ Act, 2005, debarred SEZ units from Section 10A benefits, migrating them to Section 10AA for the unexpired period. The Tribunal also clarified that the assessee is eligible for deduction for the unexpired period of ten years, as per Section 10AA(1)(i) and (ii), and not the third proviso to Section 10AA(3). The Tribunal reversed the CIT(A)'s decision allowing the Section 10A claim, finding a statutory prohibition under Section 10A(7B). The AO was directed to allow deduction under Section 10AA, subject to factual verification, and withdraw any deduction granted under Section 10A. Regarding interest under Section 234C, the AO was directed to re-compute it strictly in accordance with the provisions of the Act. The Tribunal cited the ratio from Classic Linens International (P.) Ltd. vs. Dy. CIT and ITO vs. Last Peak Data (P.) Ltd. in support of its view on the duration of deduction.
The Tribunal held that the assessee is eligible for exemption under Section 10(23C)(iiiab) of the Act read with Rule 2BBB. The Tribunal reasoned that grants received from UGC should be considered as Government grants because UGC is an intermediary between the Central Government and universities, and its funds originate from the Central Government. The Tribunal also accepted the assessee's claim that notional interest on land granted by the Government should be treated as a Government grant, citing the Karnataka High Court's decision in Indian Institute of Management (2014) 49 taxmann.com 136 (Karnataka) and its own previous decisions in the assessee's own case. When UGC grants and notional interest on land are included, the total Government grant constitutes 50.76% of total receipts, exceeding the 50% threshold. Consequently, the addition made by the AO was deleted. The penalty proceedings under Section 270A, which were based on the addition, were also deleted as the addition itself was deleted. The additional grounds raised by the assessee were kept open as they became academic.
The Tribunal held that the assessment proceedings were not invalid on the grounds of non-issuance of a valid notice under section 143(2) of the Act. However, it found that the recharges for infrastructure and central costs were not taxable as Fees for Technical Services (FTS) under Article 13 of the India-UK DTAA. Relying on the jurisdictional High Court's decision in Shell India Markets Private Limited v. Union of India, the Tribunal ruled that managerial, commercial, and business-support services do not automatically qualify as FTS unless they involve the transfer of technical knowledge, experience, skill, know-how, or processes, or developing and transferring a technical plan or design. The mere provision of advice, assistance, or specialized services, or the involvement of professional expertise, does not satisfy the 'make available' condition. The addition made by the AO on this basis was deemed misconceived and unsustainable. Consequently, the addition was deleted. As the substantive addition was deleted, other grounds were rendered academic and left unadjudicated. The appeals were allowed.
The Tribunal held that the assessee deserved one more opportunity to present its case. The Tribunal noted that the Ld. CIT(E) issued a notice on March 6, 2026, which apparently was not responded to by the assessee. Subsequently, the impugned order was passed without issuing any further notices. Therefore, the Tribunal found it appropriate to set aside the matter to the file of the Ld. CIT(E) to decide the same afresh after providing a reasonable opportunity to the assessee. The contentions on the merits of the case were left open for the assessee to raise before the Ld. CIT(E). The appeal was allowed for statistical purposes.
The Tribunal held that the assessee is eligible for deduction under Section 10AA of the Act. It reasoned that while Section 10AA(1) uses the phrase 'begins to manufacture', the provisos to Section 10AA(3) and the conditions in Section 10AA(4)(i) clarify that existing SEZ units commencing manufacturing before April 1, 2006, are also eligible, subject to other conditions. The Tribunal further noted that Section 10A(7B), introduced with the SEZ Act, 2005, debarred SEZ units from Section 10A benefits, migrating them to Section 10AA for the unexpired period. The Tribunal also clarified that the assessee is eligible for deduction for the unexpired period of ten years, as per Section 10AA(1)(i) and (ii), and not the third proviso to Section 10AA(3). The Tribunal reversed the CIT(A)'s decision allowing the Section 10A claim, finding a statutory prohibition under Section 10A(7B). The AO was directed to allow deduction under Section 10AA, subject to factual verification, and withdraw any deduction granted under Section 10A. Regarding interest under Section 234C, the AO was directed to re-compute it strictly in accordance with the provisions of the Act. The Tribunal cited the ratio from Classic Linens International (P.) Ltd. vs. Dy. CIT and ITO vs. Last Peak Data (P.) Ltd. in support of its view on the duration of deduction.
The Tribunal held that the agricultural land at Asode Village, Thane, constituted a capital asset under section 2(14)(iii)(b) of the Income Tax Act, 1961. The amended provision requires measurement of distance aerially. The Tribunal relied on the certificate from the Directorate of Maharashtra & Goa Geo-Spatial Data Centre, Survey of India, Pune, which certified the aerial distance at 5.9 km from the Thane Municipal Corporation boundary. Since Thane Municipal Corporation's population exceeded 10 lakh and the aerial distance was within the prescribed eight kilometres, the land was classified as a capital asset. Furthermore, revenue records and a Tahsildar's report indicated the land was lying fallow, and the assessee failed to provide sufficient evidence of actual agricultural operations. Therefore, Ground No. 2 was dismissed. Regarding joint ownership, the Tribunal found that while the purchase deed for a parcel included the assessee's son, the assessee admitted paying the entire purchase consideration. No evidence of contribution from the son or wife was furnished. The 7/12 extract for the other property only showed the assessee's name. The Tribunal held that mere inclusion in sale deeds does not establish beneficial ownership without supporting documentary evidence of contribution or ownership rights. Consequently, the assessment of the entire LTCG in the assessee's hands was upheld, and Ground No. 3 was dismissed. Grounds 1 and 4 were general and not adjudicated separately. The order of the CIT(A) was upheld.
The Tribunal decided the appeal on the issue of condonation of delay. The assessee sought condonation of a delay of 131 days in filing the appeal, citing her advanced age (around 80 years) and her husband's age (around 85 years), along with limitations in accessing emails and communicating with her AR. The Tribunal, at the outset, addressed the delay. The judgment indicates that the appeal was filed with a delay of 131 days, and the assessee had filed an application for condonation of this delay. The Tribunal's decision on this specific point of delay is not fully detailed in the provided text, but it is the primary procedural issue addressed. The Tribunal also noted that the CIT(A) had dismissed the grounds related to the additions and the calculation of capital gains. The judgment does not explicitly state the Tribunal's final decision on the merits of the additions or the calculation of capital gains, but it does mention that the assessee had grounds challenging these. The operative direction would depend on the outcome of the condonation of delay application and subsequent decision on the merits.
The Tribunal noted inconsistencies in the CIT(A)'s order regarding the consideration of written submissions and supporting documents. It also observed that the assessee disputed the description of the additional evidence sought to be admitted. Regarding the addition of Rs. 4,50,716/-, the Tribunal found that the dispute required examination of the sale bills actually furnished and their reconciliation with disclosed agricultural receipts. For the cash deposits of Rs. 42,37,000/-, the Tribunal noted that the assessee's explanations for deposits in different bank accounts required examination with reference to relevant bank statements, cash records, agricultural sale bills, and customer booking forms. The Tribunal considered it appropriate to afford the assessee an opportunity to substantiate the explanations before the Assessing Officer. Consequently, the Tribunal set aside the CIT(A)'s order concerning the additions of Rs. 4,50,716/- and Rs. 42,37,000/- and restored both issues to the file of the Assessing Officer for fresh adjudication. The AO was directed to verify the material already furnished, the additional evidence, and supporting reconciliations, and to examine the disputed agricultural sale bills and reconcile the cash deposits with their claimed sources. All contentions on the merits of these additions were left open. Grounds 1 to 4 were allowed for statistical purposes.
The Tribunal held that the assessee's appeals were allowed for statistical purposes. The Tribunal noted that the CIT(E) had rejected both applications on technical grounds, specifically for being filed under the wrong sections. The first application was rejected because the assessee had provisional registration and applied under a section for renewal of regular registration. The second application was rejected because the assessee had regular registration and applied under a section for regularization of provisional registration. The Tribunal found that the assessee had made efforts by filing a second application after the first rejection. It was deemed appropriate to set aside the matter to the CIT(E) to ascertain the correct factual position and decide the applications afresh as per law, after providing the assessee with a reasonable opportunity to be heard. The principle is that technical defects in filing applications should not prevent the substantive consideration of registration or renewal if the underlying documentation is available, and the assessee has made efforts to rectify the situation.
The Tribunal decided to remit the issue of Permanent Establishment (PE) and attribution of profits to the Assessing Officer (AO) for fresh examination and adjudication. The Tribunal noted that the remuneration of CSOD India, comprising a cost-plus mark-up of 17% for support services and a margin of 5% on software sales, was accepted without transfer pricing adjustment. However, this acceptance does not automatically mean all functions and risks relevant to attribution were adequately remunerated. The AO is directed to examine the true nature of the relationship between the assessee and CSOD India, including who determines customer prices, bears credit risk, assumes contractual obligations, and is responsible for performance. The AO must also verify customer details, the role of CSOD India in soliciting and processing orders, and the applicability of Article 5(4) of the India-UK DTAA. The examination should also cover the relationship between CSOD India and Cornerstone OnDemand Limited in earlier years and any realignment from AY 2020-21. The AO must independently examine the applicability of Article 5(2)(f) and Article 5(2)(k) of the India-UK DTAA, without importing MLI amendments. If a PE is found, profit attribution must be based on functions performed, assets employed, and risks assumed, considering the principle in DIT v. Morgan Stanley & Co. Inc., and not on an ad-hoc percentage. Grounds 3 to 16 were allowed for statistical purposes, as they were interconnected with the substantive grounds concerning PE and attribution. Grounds 3 and 5 were considered interconnected with PE and attribution issues and did not require separate adjudication. Grounds 11 and 12 (interest and penalty) were deemed consequential and did not require adjudication. The appeals were allowed for statistical purposes.
The Tribunal held that the reassessment proceedings were unsustainable. It found that the AO's recorded reasons expressly traced the alleged escapement of income to incriminating documentary evidence gathered during a search of another person and forwarded for action against the assessee. This foundation attracted the jurisdictional principle laid down in the case of Sejal Jewellary (supra), which mandates proceedings under section 153C when material originates from a search on a third party. The Tribunal noted that the AO could not rely on this documentary foundation to allege escapement while treating the special procedure governing such material as irrelevant. The fact that the ultimate addition concerned purchases, unlike loans in Sejal Jewellary, was not a material distinction on the jurisdictional question, as the governing consideration is the source and character of the material. The Tribunal respectfully followed the jurisdictional High Court's judgment in Sejal Jewellary (supra) and held that the notice under section 148 and the consequential reassessment order under section 143(3) read with section 147 could not be sustained. Consequently, the reassessment order was quashed, and the addition of Rs. 1,73,52,386/- did not survive. Grounds 1.01 and 4.01 were allowed. Other grounds concerning legal and procedural objections and the quantum of addition were rendered academic and left open without adjudication on merits.
The Tribunal held that the assessment proceedings were not invalid on the grounds of non-issuance of a valid notice under section 143(2) of the Act. However, it found that the recharges for infrastructure and central costs were not taxable as Fees for Technical Services (FTS) under Article 13 of the India-UK DTAA. Relying on the jurisdictional High Court's decision in Shell India Markets Private Limited v. Union of India, the Tribunal ruled that managerial, commercial, and business-support services do not automatically qualify as FTS unless they involve the transfer of technical knowledge, experience, skill, know-how, or processes, or developing and transferring a technical plan or design. The mere provision of advice, assistance, or specialized services, or the involvement of professional expertise, does not satisfy the 'make available' condition. The addition made by the AO on this basis was deemed misconceived and unsustainable. Consequently, the addition was deleted. As the substantive addition was deleted, other grounds were rendered academic and left unadjudicated. The appeals were allowed.
The Tribunal held that the assessee is eligible for deduction under Section 10AA of the Act. It reasoned that while Section 10AA(1) uses the phrase 'begins to manufacture', the provisos to Section 10AA(3) and the conditions in Section 10AA(4)(i) clarify that existing SEZ units commencing manufacturing before April 1, 2006, are also eligible, subject to other conditions. The Tribunal further noted that Section 10A(7B), introduced with the SEZ Act, 2005, debarred SEZ units from Section 10A benefits, migrating them to Section 10AA for the unexpired period. The Tribunal also clarified that the assessee is eligible for deduction for the unexpired period of ten years, as per Section 10AA(1)(i) and (ii), and not the third proviso to Section 10AA(3). The Tribunal reversed the CIT(A)'s decision allowing the Section 10A claim, finding a statutory prohibition under Section 10A(7B). The AO was directed to allow deduction under Section 10AA, subject to factual verification, and withdraw any deduction granted under Section 10A. Regarding interest under Section 234C, the AO was directed to re-compute it strictly in accordance with the provisions of the Act. The Tribunal cited the ratio from Classic Linens International (P.) Ltd. vs. Dy. CIT and ITO vs. Last Peak Data (P.) Ltd. in support of its view on the duration of deduction.
The Tribunal held that the assessee is eligible for exemption under Section 10(23C)(iiiab) of the Act read with Rule 2BBB. The Tribunal reasoned that grants received from UGC should be considered as Government grants because UGC is an intermediary between the Central Government and universities, and its funds originate from the Central Government. The Tribunal also accepted the assessee's claim that notional interest on land granted by the Government should be treated as a Government grant, citing the Karnataka High Court's decision in Indian Institute of Management (2014) 49 taxmann.com 136 (Karnataka) and its own previous decisions in the assessee's own case. When UGC grants and notional interest on land are included, the total Government grant constitutes 50.76% of total receipts, exceeding the 50% threshold. Consequently, the addition made by the AO was deleted. The penalty proceedings under Section 270A, which were based on the addition, were also deleted as the addition itself was deleted. The additional grounds raised by the assessee were kept open as they became academic.
The Tribunal held that the additional evidence sought to be admitted, comprising an FIR, details of project commencement, bank statements, and allotment letters, was relevant to the factual issues in the appeal, specifically the project's commencement and financial dealings between the assessee and the developer. Considering the relevance and the assessee's explanation for not producing the documents earlier, the Tribunal admitted the additional evidence under Rule 29 of the Income-tax (Appellate Tribunal) Rules, 1963, in the interest of justice. However, since the Assessing Officer (AO) had not examined this evidence, the Tribunal restored the matter to the AO for factual verification and fresh adjudication. The AO was directed to examine the genuineness and relevance of the FIR, allotment letters, and bank statements, verify the claim of project commencement in FY 2014-15, and correlate payments and receipts with bank entries. The AO was also mandated to provide the assessee a reasonable opportunity of being heard and confront any adverse material. The Tribunal clarified that this restoration was for statistical purposes and did not reflect on the merits of the dispute.
The Tribunal held that the assessee is eligible for deduction under Section 10AA of the Act. It reasoned that while Section 10AA(1) uses the phrase 'begins to manufacture', the provisos to Section 10AA(3) and the conditions in Section 10AA(4)(i) clarify that existing SEZ units commencing manufacturing before April 1, 2006, are also eligible, subject to other conditions. The Tribunal further noted that Section 10A(7B), introduced with the SEZ Act, 2005, debarred SEZ units from Section 10A benefits, migrating them to Section 10AA for the unexpired period. The Tribunal also clarified that the assessee is eligible for deduction for the unexpired period of ten years, as per Section 10AA(1)(i) and (ii), and not the third proviso to Section 10AA(3). The Tribunal reversed the CIT(A)'s decision allowing the Section 10A claim, finding a statutory prohibition under Section 10A(7B). The AO was directed to allow deduction under Section 10AA, subject to factual verification, and withdraw any deduction granted under Section 10A. Regarding interest under Section 234C, the AO was directed to re-compute it strictly in accordance with the provisions of the Act. The Tribunal cited the ratio from Classic Linens International (P.) Ltd. vs. Dy. CIT and ITO vs. Last Peak Data (P.) Ltd. in support of its view on the duration of deduction.
The Tribunal held that the assessee's appeals were allowed for statistical purposes. The Tribunal noted that the CIT(E) had rejected both applications on technical grounds, specifically for being filed under the wrong sections. The first application was rejected because the assessee had provisional registration and applied under a section for renewal of regular registration. The second application was rejected because the assessee had regular registration and applied under a section for regularization of provisional registration. The Tribunal found that the assessee had made efforts by filing a second application after the first rejection. It was deemed appropriate to set aside the matter to the CIT(E) to ascertain the correct factual position and decide the applications afresh as per law, after providing the assessee with a reasonable opportunity to be heard. The principle is that technical defects in filing applications should not prevent the substantive consideration of registration or renewal if the underlying documentation is available, and the assessee has made efforts to rectify the situation.
The Tribunal upheld the order of the CIT(A) and dismissed the Revenue's appeal. The Tribunal noted that the facts of the present case were identical to those in previous decisions by coordinate Benches of the ITAT in the cases of Vikas Kumar Chhajer (ITA No. 212/Viz/2025) and Kapadia Bros. (ITA No. 878/Mum/2026), which arose from the same search conducted in the J. M. Jain Group involving the "JSK" server. The Tribunal found that the additions were of the same nature, based on Excel sheets retrieved from the "JSK" server of the J. M. Jain Group. The seized documents were retrieved from the possession of a third party, and the AO had mechanically relied upon the information provided by the Investigation Wing without establishing any direct nexus. Furthermore, no stock discrepancy, unaccounted purchases, delivery challans, supplier confirmations, bank entries, or other incriminating material were found in the assessee's case. The Tribunal concluded that the additions made by the AO were based purely on uncorroborated third-party evidence and were not sustainable. No new facts or documents were presented by the Revenue to rebut the CIT(A)'s findings. Therefore, the grounds raised by the Revenue were dismissed, and the order of the CIT(A) deleting the additions was upheld. The cross-objection filed by the assessee was dismissed as infructuous.
The Tribunal noted that the appeal before the Ld. CIT(A) was dismissed for a delay of 68 days in filing, with no application for condonation of delay. The assessee argued that no opportunity of hearing was given by the Ld. CIT(A) before dismissal. The Tribunal, without delving into the merits of the issues, found it appropriate to restore the matter to the file of the Ld. CIT(A) to allow the assessee to file an application for condonation of delay. The Ld. CIT(A) is directed to decide the application for condonation of delay on its merits and, if condoned, then decide the appeal on its merits after providing adequate opportunity of hearing to the assessee. The Tribunal clarified that this decision does not reflect on the merits of the dispute. The appeal was allowed for statistical purposes.
The Tribunal held that the disallowances under section 40(a)(ia) could not be sustained without proper verification of the supplier-wise and payee-wise material and the statutory conditions governing TDS. The Tribunal noted that the assessment order lacked verification of the supplier-wise material and the applicability of section 194Q, which requires the buyer's turnover to exceed ₹10 crore in the preceding year and TDS to be deducted at 0.1% on purchases exceeding ₹50 lakh from a resident seller. For purchases from Om Swastik Trading, the Tribunal observed that the assessee had submitted Form 26A and an accountant's certificate, but these were dated after the CIT(A)'s order and required verification of the payee's return and tax paid. Regarding rent, the Tribunal noted that the threshold for TDS under section 194-I was ₹2,40,000 per payee for the relevant year and directed the AO to verify individual payments and TDS compliance. The Tribunal set aside the CIT(A)'s findings and restored the matter to the AO for fresh adjudication, considering all material and affording the assessee an opportunity to be heard. Consequential relief would be granted if the assessee establishes proper TDS compliance.
The Tribunal held that the CIT(A) was correct in allowing the deduction under Section 54F. The Tribunal agreed with the CIT(A)'s finding that the two flats, though acquired under separate agreements and having separate municipal and electricity records, were internally combined and used as a single dwelling with a common entrance and integrated living space. The Tribunal noted that the amended Section 54F recognizes that adjoining flats, even if independently purchased, can constitute one residential house upon integration. The objection regarding the ownership of another residential property was dismissed as the assessee owned only one other residential house, and the office premises were commercial. The Tribunal also found no infirmity in allowing the indexed cost of improvement, noting that the CIT(A) considered ledger extracts, payment particulars, contemporaneous recording, and the explanation for the non-availability of old vouchers, and found the expenditure reasonable. The Revenue failed to demonstrate a specific defect in the CIT(A)'s findings. Therefore, the appeal filed by the Revenue was dismissed.
The Tribunal held that the disallowance of Rs. 20,38,022 under Section 14A read with Rule 8D was unsustainable. It reasoned that while Section 14A might apply even to stock-in-trade, the Assessing Officer and CIT(A) failed to satisfy the mandatory pre-condition of recording satisfaction, having regard to the assessee's accounts, as mandated by Section 14A(2) and (3). The Tribunal emphasized that the Supreme Court judgments in Godrej & Boyce Mfg. Co. Ltd. and Maxopp Investment Ltd. did not dispense with this requirement. The correction of the quantum of disallowance by the CIT(A) did not cure the fundamental defect of non-compliance with the statutory satisfaction requirement. Therefore, the disallowance was deleted. Grounds 1 and 2 were allowed. Grounds 3 and 4, being alternative contentions, were rendered academic. Regarding Ground 5, concerning Section 234C interest, the Tribunal directed the Assessing Officer to verify the computation, provide an opportunity to the assessee, and recompute the interest as per the applicable provisions. Ground 5 was allowed for statistical purposes. Ground 6, regarding the lack of hearing, was disposed of as academic in light of the substantive relief granted. The operative direction was to delete the disallowance of Rs. 20,38,022.
The Tribunal admitted the additional ground of appeal, finding that the issue of violation of principles of natural justice goes to the root of the matter and can be considered based on available material, following the principle laid down in National Thermal Power Co. Ltd. v. CIT. The Tribunal also admitted the additional evidence, including audited financial statements and NCLT consent terms, deeming it relevant for examining the AO's additions and necessary for substantial justice, citing Pr. CIT v. Rattanchand Rikhabdas Jain Chemical Work. Given the admission of additional evidence requiring factual verification and the Assessee's contention regarding non-confrontation of the remand report, the Tribunal set aside the CIT(A)'s order and restored the matter to the AO for de novo assessment. The AO was directed to examine the additional evidence, verify additions, and afford the Assessee a reasonable and effective opportunity of being heard, including confronting any remand report. The Tribunal refrained from expressing any opinion on the merits of the additions, leaving all substantive grounds open.
The Tribunal noted that the Ld. AO primarily relied on information from the Investigation Wing and GST Commissionerate, and the non-response to Section 133(6) notices. However, the assessment order itself recorded that the assessee had furnished purchase invoices, ledger accounts, transportation receipts, and bank payment details, and had accounted for the materials in its business records. The Ld. CIT(A) had found that the assessee established a nexus between purchases and corresponding sales and disclosed a profit of 2.14%. The Tribunal observed that while adverse information against suppliers warrants examination, it must be considered alongside the assessee's documentary evidence. The Ld. CIT(A) had specifically considered the documentary evidence and the corresponding sales and profit. The Tribunal found merit in the Revenue's argument that the Ld. CIT(A) failed to examine primary documents like physical delivery of goods. Consequently, the Tribunal set aside the impugned appellate order and remanded the matter to the Ld. CIT(A) for verification of evidence as pointed out by the Ld. AO, allowing both parties a reasonable opportunity. The grounds raised by the Revenue were restored to the file of the Ld. CIT(A).
The Tribunal allowed Ground No. 3 of the appeal, holding that the Assessment Order was time-barred. The Tribunal noted that the Assessment Order itself was dated 30.07.2015, but the postal tracking record clearly showed the article was booked and dispatched on 07.04.2015, and delivered on 08.04.2015. This dispatch date was after the statutory period for passing the assessment order. The Tribunal relied on the Delhi High Court decision in Quolimax Electronics Vs UOI and coordinate bench decisions of the Delhi, Kolkata, and Cuttack Tribunals, which held that an order dispatched after the statutory deadline is hit by limitation and stands void. Since Ground No. 3 was allowed, the adjudication of other grounds on merits became academic. The appeal was allowed, and the assessment order was set aside.
The Tribunal condoned the delay of 49 days in filing the appeal before the CIT(A). The assessee's explanation of illness was found plausible and not disproven. This, coupled with the ex parte assessment, was considered sufficient cause for the delay. Since the CIT(A) had dismissed the appeal solely on the grounds of limitation, the Tribunal set aside the CIT(A)'s order. The matter was restored to the Assessing Officer for fresh adjudication. The Assessing Officer was directed to provide the assessee with the bank-wise information and other materials relied upon, verify account ownership and relevant periods, and reconcile discrepancies in figures. The assessee is to be given a reasonable opportunity to explain the deposits and credits and furnish supporting material. The Assessing Officer is to pass a speaking order thereafter. The Tribunal expressed no opinion on the merits of the addition.
The Tribunal partly allowed the appeal concerning the addition made on account of estimated business income. For AY 2014-15, the addition was restricted to 2% of sales, instead of the 5% initially made by the AO. This decision was applied mutatis mutandis to the instant ground. Regarding the addition of Rs. 2,06,56,349/- under section 68, the Tribunal upheld the authorities below. The assessee failed to satisfy the three conditions required to establish the burden of proof for loans: identity, creditworthiness, and genuineness of the transaction. While identity was established, the creditworthiness of the lenders and the genuineness of the transactions were not proved, even after ample opportunity. Summons issued to the lending entities were not complied with, and statements from directors of these entities indicated they were 'paper companies' used for accommodation entries. Therefore, the loans were treated as bogus and added back to the income. The Tribunal noted that the grounds for AY 2013-14 were adjudicated against the assessee, and the decision applied to the instant appeal.
The Tribunal partly allowed the appeal concerning the addition made on account of estimated business income. For AY 2014-15, the addition was restricted to 2% of sales, instead of the 5% initially made by the AO. This decision was applied mutatis mutandis to the instant ground. Regarding the addition of Rs. 2,06,56,349/- under section 68, the Tribunal upheld the authorities below. The assessee failed to satisfy the three conditions required to establish the burden of proof for loans: identity, creditworthiness, and genuineness of the transaction. While identity was established, the creditworthiness of the lenders and the genuineness of the transactions were not proved, even after ample opportunity. Summons issued to the lending entities were not complied with, and statements from directors of these entities indicated they were 'paper companies' used for accommodation entries. Therefore, the loans were treated as bogus and added back to the income. The Tribunal noted that the grounds for AY 2013-14 were adjudicated against the assessee, and the decision applied to the instant appeal.
The Tribunal noted that the assessee did not appear for the hearing, despite due notice, and proceeded ex parte. The Tribunal observed that the assessee had not filed a return of income and that the AO had made additions and initiated penalty proceedings under Section 271(1)(c) for concealment of income amounting to Rs. 2,68,62,229/-. It was also noted that the CIT(A) had set aside the quantum additions to the file of the AO for fresh assessment. In light of the assessee's non-appearance and the setting aside of the quantum assessment, the Tribunal imposed a cost of Rs. 5,000/- on the assessee, to be deposited in the Prime Minister's National Relief Fund within 30 days. The matter was restored to the file of the AO for fresh adjudication, with a direction to provide adequate opportunity of hearing to the assessee and for the assessee to remain cooperative. The Tribunal clarified that this decision did not express any opinion on the merits of the dispute. The appeal was allowed for statistical purposes.
The Tribunal held that the issue of applicability of Section 56(2)(vii)(b)(ii) and the valuation date for stamp duty are intertwined and require a factual determination of when the rights in the property effectively accrued to the assessee. The Tribunal noted that the assessee's claim is that the agreement to sell and the price were finalized in 2005, with registration delayed due to society restrictions. The Tribunal found that the lower authorities had not adequately examined the date of the agreement and the nature of rights that accrued to the assessee in 2005. Therefore, the Tribunal decided to restore the matter to the file of the AO for a fresh adjudication. The AO was directed to examine the date of the agreement, the consideration paid, the nature of rights that accrued to the assessee in 2005, and the reasons for the delay in registration. Based on this factual determination, the AO was to decide the applicability of Section 56(2)(vii)(b)(ii) and, if applicable, the relevant date for valuation and the proportionate share of the addition. The Tribunal expressly left undecided the substantive application of the section and the quantum of addition, pending the AO's fresh inquiry.
The Tribunal partly allowed the appeal concerning the addition made on account of estimated business income. For AY 2014-15, the addition was restricted to 2% of sales, instead of the 5% initially made by the AO. This decision was applied mutatis mutandis to the instant ground. Regarding the addition of Rs. 2,06,56,349/- under section 68, the Tribunal upheld the authorities below. The assessee failed to satisfy the three conditions required to establish the burden of proof for loans: identity, creditworthiness, and genuineness of the transaction. While identity was established, the creditworthiness of the lenders and the genuineness of the transactions were not proved, even after ample opportunity. Summons issued to the lending entities were not complied with, and statements from directors of these entities indicated they were 'paper companies' used for accommodation entries. Therefore, the loans were treated as bogus and added back to the income. The Tribunal noted that the grounds for AY 2013-14 were adjudicated against the assessee, and the decision applied to the instant appeal.
The Tribunal upheld the order of the CIT(A). The Tribunal noted that the CIT(A) had followed the decision of a Co-ordinate Bench of the ITAT, Pune, in the assessee's own case for AY 2017-18, which dealt with identical facts. The Revenue was unable to distinguish the present case from the precedent set by the Co-ordinate Bench. Furthermore, the Tribunal observed that a consequential order had already been passed by the AO based on the ITAT's directions, and the Revenue had not shown that the Co-ordinate Bench's order was challenged before any higher forum, implying it had attained finality. Therefore, applying the doctrine of binding precedents and maintaining judicial consistency, the Tribunal rejected the grounds raised by the Revenue and dismissed the appeals filed by the Department.
The Tribunal upheld the order of the CIT(A). The Tribunal noted that the CIT(A) had followed the decision of a Co-ordinate Bench of the ITAT, Pune, in the assessee's own case for AY 2017-18, which dealt with identical facts. The Revenue was unable to distinguish the present case from the precedent set by the Co-ordinate Bench. Furthermore, the Tribunal observed that a consequential order had already been passed by the AO based on the ITAT's directions, and the Revenue had not shown that the Co-ordinate Bench's order was challenged before any higher forum, implying it had attained finality. Therefore, applying the doctrine of binding precedents and maintaining judicial consistency, the Tribunal rejected the grounds raised by the Revenue and dismissed the appeals filed by the Department.
The Tribunal held that the CIT(A) was justified in deleting the additions. For AY 2016-17, the assessee had furnished comprehensive evidence including the lender's IT return acknowledgement, confirmations, bank statements, audited financial records, details of the lender's source of funds, and evidence of TDS on interest payments. The loan was repaid through banking channels and the account was squared up before reopening. The Tribunal found no defect in the documentary evidence or independent material to connect the loan with accommodation entries. The investigation information did not dispense with the need to consider the assessee's evidence. The lender's non-response, without contrary findings on the furnished evidence, was insufficient to establish the loan's non-genuineness. The Tribunal relied on the decision in ITO v. Agripure Tradeware Pvt. Ltd. and Bombay and Gujarat High Court decisions in PCIT v. Bairagra Builders (P.) Ltd. and PCIT v. Merrygold Gems (P.) Ltd., which emphasized the importance of actual repayment and documentary evidence. The deletion of the loan addition under Section 68 and the consequential interest disallowance under Section 37(1) were upheld. The same reasoning applied mutatis mutandis to AY 2017-18 and AY 2018-19 for the loan and interest additions. Regarding the Section 69C addition for AY 2017-18, the Tribunal upheld its deletion as the AO had not identified specific payments or brought evidence of actual commission expenditure, and the loan transactions were accepted as genuine.
The Tribunal held that the CIT(A) was justified in deleting the additions. For AY 2016-17, the assessee had furnished comprehensive evidence including the lender's IT return acknowledgement, confirmations, bank statements, audited financial records, details of the lender's source of funds, and evidence of TDS on interest payments. The loan was repaid through banking channels and the account was squared up before reopening. The Tribunal found no defect in the documentary evidence or independent material to connect the loan with accommodation entries. The investigation information did not dispense with the need to consider the assessee's evidence. The lender's non-response, without contrary findings on the furnished evidence, was insufficient to establish the loan's non-genuineness. The Tribunal relied on the decision in ITO v. Agripure Tradeware Pvt. Ltd. and Bombay and Gujarat High Court decisions in PCIT v. Bairagra Builders (P.) Ltd. and PCIT v. Merrygold Gems (P.) Ltd., which emphasized the importance of actual repayment and documentary evidence. The deletion of the loan addition under Section 68 and the consequential interest disallowance under Section 37(1) were upheld. The same reasoning applied mutatis mutandis to AY 2017-18 and AY 2018-19 for the loan and interest additions. Regarding the Section 69C addition for AY 2017-18, the Tribunal upheld its deletion as the AO had not identified specific payments or brought evidence of actual commission expenditure, and the loan transactions were accepted as genuine.
The Tribunal held that the notice under Section 148, dated 4 April 2022, for Assessment Year 2015-16, was barred by limitation. It relied on the concession recorded in Union of India v. Rajeev Bansal, where the Revenue conceded that for AY 2015-16, notices issued on or after 1 April 2021 would not fall within the period prescribed under TOLA. This position was affirmed by the Bombay High Court in Verjinia Foods Ltd. and Cherian Nallathu Abraham Annamma. Consequently, the Tribunal found that TOLA could not be invoked to validate the notice, and the Assessing Officer lacked jurisdiction. The reassessment order was quashed on this ground. Independently, on merits, the Tribunal deleted the addition of ₹1,32,56,700 made under Section 69. The Tribunal noted that while joint ownership established the assessee's interest, it did not prove she contributed half the consideration from unexplained funds. The explanation that the initial 25% was paid by her husband from salary savings and the balance financed by ICICI Bank under a 25:75 scheme was not adequately examined by the Assessing Officer. The addition was deemed unsustainable as the assessment order did not identify independent material showing the assessee contributed from an unexplained source. The consequential application of Section 115BBE was also deleted.
The ITAT held that the delay of 516 days in filing the appeal before the Tribunal could not be condoned. The Tribunal relied on the Supreme Court's decisions in Basawaraj v. Special Land Acquisition Officer, Pathapati Subba Reddy (Died) & Ors. v. The Special Deputy Collector (LA), and H. Guruswamy & Ors. v. A. Krishnaiah (Since Deceased) through LRs. These judgments emphasize the need for "sufficient cause" for delay, the public policy behind the law of limitation, and the principle that liberal approaches should not be used to defeat the law of limitation. The Tribunal noted that the assessee had not furnished any justifiable explanation for the delay and had also remained ex parte before the CIT(A), indicating a lack of due diligence. Consequently, the delay was not condoned, and the appeal was dismissed as barred by limitation. The issue of non-prosecution was implicitly addressed by the dismissal due to the delay and lack of appearance.
The Tribunal held that the AO was not justified in denying depreciation on goodwill. The acquisition was a slump sale of a business, not an amalgamation, and the goodwill arose from the excess consideration paid over the net assets acquired. The Tribunal relied on the decision in Thermo Fisher Scientific India (P.) Ltd., which held that goodwill arising from the acquisition of units under a slump sale is eligible for depreciation. The Tribunal found that the AO's reasoning, based on the written-down value of goodwill in the hands of the predecessor being nil and the applicability of amalgamation provisions, was incorrect. The sixth proviso to Section 32(1) was not applicable as the goodwill was not part of a depreciable block in the transferor's hands. The Tribunal also rejected the AO's view that the Finance Act, 2021 amendment applied retrospectively to AY 2016-17, noting that the amendment explicitly applied from AY 2021-22 onwards. The Tribunal concurred with the CIT(A)'s findings, upholding the deletion of the disallowance. The grounds raised by the Revenue were dismissed.
The Tribunal held that the assessee is eligible for claiming set off of brought forward business loss against the short term capital gain earned on the sale of depreciable assets. The Tribunal noted that the CIT(A) relied on the decision in Sabeena Silk Mills, which was subsequently recalled by the Tribunal, thus losing its reliance value. The Tribunal also distinguished the case of Everest Kanto Cylinder Ltd. as being based on different facts. The Tribunal found that the issue was squarely covered by the jurisdictional High Court's decision in Pr.CIT Vs. Alcon Developers, which held that business loss can be set off against income from capital gains earned from selling a business undertaking. Similar views were taken by the Karnataka High Court in Nandi Steels Ltd. and the Mumbai Tribunal in Digital Electronics Ltd., where it was held that business loss under section 72 can be set off against any profit of any business or profession, and there is no requirement for the gain to be taxable under the head 'Profit and gains of business or profession'. The Tribunal further noted that the decision in Digital Electronics Ltd. was accepted by the Revenue. Therefore, the ground of appeal raised by the assessee was allowed. The operative direction was that the appeal filed by the assessee is Allowed.
The Tribunal found that the AO had treated credits in the business current account as business receipts and estimated income. The assessee's primary contention was that these very receipts were utilized for credit card payments. However, the assessment order and the CIT(A)'s order lacked examination of the corresponding debits in the bank accounts and their linkage to the credit card payments. For Section 69A, the explanation regarding the nature and source of money is crucial. If payments were made from receipts already accepted as business turnover, the source is explained to that extent, and a separate addition under Section 69A cannot be sustained solely on the basis of utilization for credit card dues. The general observation that the two additions operate in different fields does not address the common source of funds argument. Therefore, the Tribunal set aside the CIT(A)'s order regarding the addition of Rs. 42,22,574/- and restored the issue to the AO for fresh examination. The AO is directed to verify bank and credit card statements to ascertain if payments were made from accounts whose credits were treated as business receipts. If so, no separate addition under Section 69A should be made for those payments. Payments from savings accounts are also to be examined. The assessee must provide reconciliation. Grounds relating to lack of opportunity were not separately considered due to the restoration of the issue. The appeal was allowed for statistical purposes.
The Tribunal held that the penalty order passed under Section 270A of the Income Tax Act, 1961, cannot be sustained. The primary reason for this decision was the defective show-cause notice issued by the Assessing Officer. The notice failed to specify whether the penalty proceedings were initiated for 'under-reporting' or 'misreporting' of income, nor did it specify the particular sub-clause of Section 270A(9) under which the assessee was alleged to have misreported income. The Tribunal emphasized that under-reporting and misreporting are distinct, with different penalty consequences (50% for under-reporting and 200% for misreporting). The specific sub-clauses of Section 270A(9) define misreporting. A vague notice deprives the assessee of a fair and effective opportunity to defend themselves, violating principles of natural justice. The Tribunal found that the penalty order did not clearly specify which limb of Section 270A(9) was invoked, and this defect was not curable. Relying on its own coordinate bench decision in Hi-Tech Engineers, the Tribunal quashed the penalty order and the consequential order of the CIT(A). The appeal filed by the assessee was allowed.
The Tribunal held that the CIT(A) was justified in deleting the additions. For AY 2016-17, the assessee had furnished comprehensive evidence including the lender's IT return acknowledgement, confirmations, bank statements, audited financial records, details of the lender's source of funds, and evidence of TDS on interest payments. The loan was repaid through banking channels and the account was squared up before reopening. The Tribunal found no defect in the documentary evidence or independent material to connect the loan with accommodation entries. The investigation information did not dispense with the need to consider the assessee's evidence. The lender's non-response, without contrary findings on the furnished evidence, was insufficient to establish the loan's non-genuineness. The Tribunal relied on the decision in ITO v. Agripure Tradeware Pvt. Ltd. and Bombay and Gujarat High Court decisions in PCIT v. Bairagra Builders (P.) Ltd. and PCIT v. Merrygold Gems (P.) Ltd., which emphasized the importance of actual repayment and documentary evidence. The deletion of the loan addition under Section 68 and the consequential interest disallowance under Section 37(1) were upheld. The same reasoning applied mutatis mutandis to AY 2017-18 and AY 2018-19 for the loan and interest additions. Regarding the Section 69C addition for AY 2017-18, the Tribunal upheld its deletion as the AO had not identified specific payments or brought evidence of actual commission expenditure, and the loan transactions were accepted as genuine.
The Tribunal held that the penalty orders levied under Section 271(1)(c) of the Income Tax Act for Assessment Years 2010-11 and 2011-12 would not survive. The reasoning was that the Tribunal's earlier order dated 05.06.2024 had set aside the assessments for these years to the Assessing Officer for de novo consideration. As a consequence of the assessments being set aside, the quantum additions no longer existed. Therefore, the penalty orders, which were based on these quantum additions, were rendered unsustainable. The Tribunal set aside the orders passed by the Assessing Officer under Section 271(1)(c) for both assessment years. The operative direction was to set aside the penalty orders.
The Tribunal held that the appeal of the assessee should be restored to the file of the Ld. CIT(E). The reasoning was based on the totality of facts and circumstances, particularly the explanation provided by the assessee regarding the non-receipt of notices due to outdated email IDs on the Income-tax portal. The Tribunal acknowledged that the non-participation was not deliberate or intentional and that the assessee was now prepared to furnish all relevant documents and explanations. The ratio decidendi is that an ex-parte order, especially concerning registration under Section 12AB, should be set aside if the assessee demonstrates a lack of opportunity due to genuine technical or procedural lapses, provided the assessee is willing to cooperate and present its case. The operative direction was to restore the matter to the CIT(E) for fresh adjudication after providing an adequate opportunity to the assessee.
The Tribunal held that the assessee cannot be treated as an 'assessee in default' within the meaning of Section 201(1)/201(1A) of the Act. The reasoning was that the directions issued by the Hon'ble Madras High Court via its order dated 16.02.2015 were binding on the assessee during the period under consideration. The Tribunal noted that the Madras High Court had granted an interim stay on a circular disallowing overseas LTC and subsequently held that LTC paid or reimbursed would not amount to income, and therefore, no tax was to be deducted. The Tribunal observed that if the assessee had deducted tax at source contrary to these orders, it would have amounted to contempt of court. The Tribunal respectfully followed the decision of a coordinate bench in the assessee's own case, which had dealt with identical facts and reached the same conclusion. Accordingly, the order passed by the Assessing Officer under Section 201(1)/201(1A) was quashed, and the grounds raised by the assessee were allowed. The appeal of the assessee was allowed.
The Tribunal held that the penalty orders levied under Section 271(1)(c) of the Income Tax Act for Assessment Years 2010-11 and 2011-12 would not survive. The reasoning was that the Tribunal's earlier order dated 05.06.2024 had set aside the assessments for these years to the Assessing Officer for de novo consideration. As a consequence of the assessments being set aside, the quantum additions no longer existed. Therefore, the penalty orders, which were based on these quantum additions, were rendered unsustainable. The Tribunal set aside the orders passed by the Assessing Officer under Section 271(1)(c) for both assessment years. The operative direction was to set aside the penalty orders.
The Tribunal admitted the additional grounds of appeal as they were purely legal. Regarding the first issue, the Tribunal held that the AO did not specify any variations under Section 270A(2) or Section 270A(9) but merely stated that proceedings were initiated for under-reporting of income due to misreporting. Following the decisions of the Delhi High Court in *Schneider Electric South East Asia (Hq) Pte Ltd. v. ACIT* and others, the Tribunal concluded that the notice issued under Section 270A was bad in law, and consequently, the penalty order was also bad in law. On the second issue, the Tribunal noted that the assessee's return filed in response to the Section 148 notice was accepted without variation because the assessee had voluntarily withdrawn the Section 80GGC deduction. Citing the Surat Bench decision in *Mr. Dipesh Narendrakumar Patel v. ITO*, which followed the Delhi High Court's ruling, the Tribunal held that since the AO accepted the return without additions, the income could not be termed as under-reported or misreported. Therefore, the penalty levied under Section 270A was quashed. The appeal was allowed, and the AO was directed to delete the penalty.