ITAT Nagpur Judgments — May 2025

The Tribunal held that the reassessment notice was unsustainable as the alleged escaped income of Rs. 25,53,000 was below the threshold of Rs. 50 lakh required for reassessment beyond three years under Section 149(1)(b). Consequently, the assessment order was quashed.

The Tribunal observed that the amount of cash deposit was already reflected as turnover and offered as business income. Adding it separately would lead to double taxation. Therefore, the impugned order of the CIT(A) was overturned.

The Tribunal held that the filing of Form 67 is a procedural and directory requirement, not a mandatory one. Violation of procedural norms does not extinguish the substantive right of claiming credit. The provisions of the Double Taxation Avoidance Agreement (DTAA) override the Act, and since the DTAA does not specify disallowance for delayed filing of Form 67, the disallowance by the authorities was not justified.

The Tribunal observed that the assessee had not made any representation before the authorities below and was a non-filer. However, to ensure natural justice and fair play, one more opportunity was granted to the assessee to present its case before the Assessing Officer.

The Tribunal held that the assessee had incorrectly approached the Tribunal instead of first seeking recourse from the CIT(A) regarding the order giving effect to its own decision. It stated that the assessee cannot bypass the established protocol. Therefore, the appeal was dismissed as being filed in the wrong forum.

The Tribunal held that the reassessment proceedings under Section 147 were initiated on an incorrect basis and were not sustainable as they were based on mere suspicion and lacked a nexus with material evidence. The CIT(A) erred in confirming the addition and disregarding judicial precedents that established rural agricultural land is not a capital asset.

The Tribunal condoned the delay in filing the appeal. The Tribunal directed the lower appellate authority to condone the delay and adjudicate the issues raised by the assessee on merit.

The Tribunal held that the CIT(A) erred in upholding an arbitrary 10% addition without independent basis or evidence. The Tribunal noted that the explanation regarding the source of cash was substantially correct and not disproved, and thus, no addition under Section 69A could be made merely on suspicion. The Tribunal also observed that the assessee is a pass-through entity, and any addition should be in the name of depositors.

The Tribunal upheld the CIT(A)'s decision, finding that the assessee had discharged its burden regarding the identity and genuineness of unsecured loans and that bad debts and EMD lapses were allowable business expenses. The Tribunal agreed with the CIT(A)'s deletion of the additions.

The Tribunal deleted the addition on account of silver and diamonds, finding the assessee's explanation satisfactory and the payments made through banking channels. The addition on account of rent was sustained to the extent of 70%, with statutory deductions allowed.

The Tribunal held that the CIT(A) correctly deleted the additions made by the Assessing Officer. The Tribunal affirmed the CIT(A)'s decision, stating that the additions were made without incriminating evidence, and the notice under Section 153A was not justified in the absence of pending assessments or incriminating documents.

The Tribunal held that for assessments under Section 153A, additions can be made even in the absence of incriminating documents, provided the assessment proceedings were abated. However, if assessments were already completed and unabated, Section 153A proceedings could not be initiated without incriminating material.

The CIT(A) deleted most of the additions made by the Assessing Officer, often by admitting additional evidence and relying on remand reports. The Tribunal upheld the CIT(A)'s decision, finding no reason to interfere with the deletions.

The Tribunal held that provisions of Section 153C should have been invoked instead of Section 147/148, as the information originated from a search action. The defect in jurisdiction was considered non-curable.

The Tribunal held that the addition was based solely on the statement of an ex-employee, whose veracity was not tested through cross-examination. The documents were seized from an unconnected person, and the addition was made on a protective basis, indicating fragility. Therefore, the addition was directed to be deleted.

The Tribunal held that the addition of ₹3,70,000 was not justified as it was based on unsigned draft agreements and the payment was made by a company. The Tribunal also held that the addition of ₹5,91,000 was unsustainable as it was recorded in the regular books of accounts and the source of cash was explained and undisputed.

The Tribunal held that the notice and action under Section 153A were bad in law as the assessments had become unabated and were completed prior to the search. Additions made by the AO were not based on any incriminating documents seized during the search.

The Tribunal held that the transaction in question was a repayment of an existing loan, not a fresh advance or loan. Therefore, it does not fall under the ambit of Section 2(22)(e) of the Income Tax Act. The repayment of a loan is a discharge of an existing liability and does not create a new loan or advance for the purposes of Section 2(22)(e).

The Tribunal held that the revenue had not provided sufficient material to justify reducing the declared agricultural income. The ad-hoc addition by the Assessing Officer and the estimation by the CIT(A) were deemed unsustainable without irrefutable evidence.

The Tribunal held that the CIT(A) correctly deleted the additions made by the Assessing Officer. The Tribunal affirmed the CIT(A)'s decision, stating that the additions were made without incriminating evidence, and the notice under Section 153A was not justified in the absence of pending assessments or incriminating documents.

The Tribunal deleted the addition on account of silver and diamonds, finding the assessee's explanation satisfactory and the payments made through banking channels. The addition on account of rent was sustained to the extent of 70%, with statutory deductions allowed.

The Tribunal held that the revenue had not provided sufficient material to justify reducing the declared agricultural income. The ad-hoc addition by the Assessing Officer and the estimation by the CIT(A) were deemed unsustainable without irrefutable evidence.

The Tribunal held that the notice and action under Section 153A were bad in law if the assessments were unabated and no incriminating documents were found. Additions cannot be made under Section 153A in the absence of incriminating material when the assessment is not pending.

The Tribunal upheld the CIT(A)'s decision to delete the additions, noting that the CIT(A) had relied on the AO's own remand reports where the assessee's explanations and evidence were accepted. The Tribunal emphasized that the Revenue should not file appeals when relief was granted based on the AO's own findings in remand proceedings.

The Tribunal held that once a search takes place, notice under Section 153A is mandatory. Assessments pending on the date of search abate, and the AO has the power to assess total income for the preceding six years, even without incriminating documents, by reiterating completed assessments or making fresh ones.