ITAT Nagpur Judgments — April 2025

The Tribunal held that although the CIT(A) had granted opportunities, the final order was ex-parte. To uphold the principles of natural justice, one more opportunity should be given to the assessee to present their case.

The Tribunal held that the CIT(A) rightly invoked the amended provisions of section 251(1)(a) of the Income Tax Act, 1961, by setting aside the ex-parte assessment order and remanding the case to the Assessing Officer for a fresh assessment, as the submitted evidences had a direct bearing on the issue.

The Tribunal held that the land was agricultural based on revenue records (Adangal, Tahsildar's letter) and was located beyond municipal limits, thus qualifying for exemption under Section 2(14) of the Income Tax Act. The conversion of land to non-agricultural use was initiated by the purchaser, not the assessee, and the enquiry by the AO was conducted after six years, rendering it futile.

The assessee submitted an application to withdraw the appeal due to settling the matter under the Direct Tax Vivad Se Vishwas Scheme. The tribunal considered the assessee's intention and decided to treat the appeal as withdrawn.

The Tribunal dismissed all appeals. It upheld the CIT(A)'s decisions to treat brand development expenses and premium on non-convertible debentures as allowable deductions, consistent with prior judgments in the assessee's own case and other precedents. The Tribunal also confirmed the CIT(A)'s decision to allow 40% depreciation on aircraft and to assess income from share sales as capital gains. For the corporate guarantee fee, the Tribunal upheld the CIT(A)'s restriction to 0.2%, dismissing both the Revenue's and assessee's appeals on this point.

The Tribunal dismissed all appeals. It upheld the CIT(A)'s findings that brand development expenses were revenue in nature and the premium on non-convertible debentures was an allowable deduction without TDS liability, citing previous judgments. The Tribunal affirmed the CIT(A)'s decision to restrict the corporate guarantee fee to 0.2%, dismissing both the Revenue's plea for a higher rate and the assessee's contention against any adjustment. Furthermore, the Tribunal upheld the allowance of 40% depreciation on aircraft and the classification of income from share sales as capital gains.

The assessee's counsel stated that the relief sought in the appeal had already been granted by the Assessing Officer. Therefore, the appeal was treated as withdrawn.

The Tribunal upheld the CIT(A)'s decisions across all issues, dismissing all appeals. It ruled that Brand Development Expenses are revenue expenditure, premium on non-convertible debentures is allowable as no TDS was required due to unidentifiable payees, 40% depreciation is applicable to aircraft, and income from share sales should be treated as capital gain. For the corporate guarantee fee, the Tribunal found the 0.2% ALP adjustment by the CIT(A) justified, dismissing both the Revenue's challenge for a higher rate and the assessee's challenge to any adjustment.

The assessee requested to withdraw the appeal as they had opted for the Direct Tax Vivad se Vishwas Scheme, 2024. The Tribunal granted permission to withdraw the appeal, with liberty to restore it if the scheme declaration did not succeed.

The Tribunal held that penalty under section 271(1)(c) is leviable only when an assessee conceals income or furnishes inaccurate particulars. A mere claim, even if unsustainable, does not automatically amount to furnishing inaccurate particulars, especially when it arises from an interpretation of facts. The Supreme Court's judgment in CIT vs. Reliance Petroproducts Pvt. Ltd. was relied upon.

The Tribunal held that the additions made by the AO were unsustainable. In the case of unexplained cash credit, the assessee had provided loan confirmation, bank statements, and proof of the lender's creditworthiness. For the long-term capital gains, the assessee had produced documentary evidence of share purchase, sale, and payment, and the AO's reliance on statements without corroborative evidence was not sufficient.

The Tribunal held that the assessee failed to prove the genuineness of its agricultural income claim for both A.Y. 2011-12 and A.Y. 2012-13. The previous year's addition remained unchallenged, and the current year showed a significant jump in income without supporting evidence. The Tribunal found the claim to be a ploy to launder unaccounted money.

The Tribunal granted permission to the assessee to withdraw the appeal. The assessee was also granted liberty to revive the appeal if the outcome of the Vivad se Vishwas Scheme declaration was not favorable.

The Tribunal held that the addition made by the Assessing Officer was based on loose sheets and conjectures, lacking proper corroborative evidence. The seized documents were considered as dumb notings and not admissible as evidence under the Indian Evidence Act without corroboration. The Tribunal found no merit in the Revenue's appeal and agreed with the CIT(A)'s findings.

The Tribunal held that the denial of exemption under Section 11 should be limited to the extent of the violation of Section 13(1)(c)(ii), not the entire income. Regarding the addition of ₹43,50,000, it was deemed not to be unexplained income under Section 69A as the source was known, and the addition was upheld as interest income taxable at normal rates. The claim for depreciation was allowed as an application of income since capital expenditure was not claimed. All grounds raised by the Revenue were dismissed.

The Tribunal held that the denial of exemption under Section 11 should be limited to the extent of the violation of Section 13(1)(c)(ii). It also found that additions based on 'dumb documents' were unwarranted and that depreciation claims should be allowed if capital expenditure was not claimed. All grounds raised by the Revenue were dismissed.

The Tribunal held that the denial of exemption under Section 11 should be limited only to the extent of the violation of Section 13(1)(c)(ii), not the entire income. Regarding the addition under Section 69A concerning the advance for property purchase, the Tribunal found the basis (impounded documents) insufficient and not properly confronted, thus unwarranted. For depreciation, the Tribunal upheld the CIT(A)'s allowance, noting that the assessee could claim either depreciation or capital expenditure as application of income, but not both, and since depreciation was disallowed, the benefit of capital expenditure should be allowed if not already claimed.

The Tribunal held that the Assessing Officer's addition was based on loose sheets and conjectures without corroborating evidence. The CIT(A) had correctly deleted the addition because the seized documents were found to be 'dumb notings' and not attributable to the assessee. The Revenue failed to provide evidence to disprove the assessee's submissions and the findings of the CIT(A).