ITAT Panaji Judgments — February 2025

The Tribunal found that the CIT(A) erred by admitting fresh evidence without following Rule 46A and without providing the Assessing Officer an opportunity to comment. Furthermore, the CIT(A) failed to pass a speaking order identifying the issue, stating the decision, and providing reasoning as required by Section 250(6). Consequently, the Tribunal set aside the CIT(A)'s orders and remanded the cases back for de novo adjudication with directions to consider the addition in accordance with Section 4 and other applicable law, and to issue speaking orders as per Section 250(6).

The Tribunal noted that the CIT(A)'s order suffered from non-compliance with Rule 46A and transgressed provisions of Sections 251(1) and 250(6) of the Act, particularly regarding the admission of fresh evidence without affording the AO an opportunity. Citing a similar co-ordinate bench decision, the Tribunal set aside the CIT(A)'s orders and remanded the cases back to the CIT(A) for de-nova adjudication, with directions to pass speaking orders in accordance with Section 4 and other applicable laws.

The Tribunal found that the CIT(A)'s order suffered from procedural infirmities, including non-compliance with Rule 46A of the Income Tax Rules, sub-section (1) of Section 251, and sub-section (6) of Section 250 of the Income Tax Act. The CIT(A) admitted fresh evidence without proper verification, inquiry, or providing an opportunity to the AO. Consequently, the Tribunal set aside the CIT(A)'s orders and remanded the cases back for de novo adjudication with directions to verify the refund and pass speaking orders as per Section 4 and sub-section (6) of Section 250.

The Tribunal found that the Commissioner of Income Tax (Appeals)'s orders suffered from procedural non-compliance with Rule 46A of Income Tax Rules, sub-section (1) of Section 251, and sub-section (6) of Section 250 of the Act. Consequently, the Tribunal partly allowed the revenue's appeals for statistical purposes and remanded the matters back to the Commissioner of Income Tax (Appeals) for de-novo adjudication, with directions to consider Section 4 and other applicable legal provisions and pass speaking orders.

The Tribunal found that the CIT(A)'s orders suffered from procedural non-compliance with Rule 46A and transgressed the provisions of sub-section (1) of Section 251 and sub-section (6) of Section 250. Consequently, the Tribunal set aside the CIT(A)'s orders and remanded the cases back for de-novo adjudication, directing the CIT(A) to address the disputed addition according to Section 4 and other applicable laws, and pass speaking orders.

The Tribunal found that the CIT(A)'s orders suffered from non-compliance with Rule 46A and transgressed Section 251(1) and Section 250(6) of the Act, as the CIT(A) failed to verify facts and admit fresh evidence properly. Following a co-ordinate bench's decision on similar facts, the Tribunal set aside the CIT(A)'s orders. The cases were remanded back to the CIT(A) for de-novo adjudication, with a direction to deal with the disputed addition in accordance with Section 4 and Section 250(6) of the Income Tax Act.

The Tribunal found that the CIT(A) erred by not complying with Rule 46A regarding additional evidence and provisions of Section 251(1) and Section 250(6) by not giving the Assessing Officer an opportunity to verify the refund or comment. Consequently, the Tribunal set aside the CIT(A)'s orders and remanded the cases for de-novo adjudication, directing the CIT(A) to properly consider the disputed addition under Section 4 and pass speaking orders.

The Tribunal held that the forex fluctuation loss on closing balances in EEFC accounts, arising from trading activities, constitutes revenue loss and is deductible under Section 37(1) of the Income Tax Act. It reasoned that EEFC account balances derived from export sales represent circulating or working capital, and losses on such capital are not notional but real and revenue in nature, consistent with settled legal precedents including Supreme Court and High Court decisions.

The Tribunal found that the Ld. CIT(A) erred by admitting additional evidence without following Rule 46A procedures and passed orders without proper verification of facts or giving the AO an opportunity to comment. Citing non-compliance with the procedural provisions of sub-section (1) of Section 251 and sub-section (6) of Section 250 of the Act, the Tribunal set aside the CIT(A)'s orders. It remanded the cases back to the CIT(A) for de-novo adjudication, directing the CIT(A) to pass separate speaking orders in accordance with Section 4 and other applicable laws.

The Tribunal acknowledged the assessee's election to participate in the DTVSV 2024 scheme and the subsequent withdrawal of the appeal. Accordingly, the appeal was dismissed as withdrawn, with the assessee granted the liberty to file an application under Section 254(2) of the Act to recall the order if necessary.

Citing Supreme Court precedents and ITAT Standing Orders, the Tribunal held that the situs of the Assessing Officer is the decisive factor for determining appellate jurisdiction. Since the AO's location fell outside the Panaji Bench's jurisdiction, the appeal was deemed 'not-maintainable' and dismissed in limine, with liberty granted to the assessee to file it before the appropriate jurisdictional bench in Bangalore.

The Tribunal, applying principles of natural justice, set aside the ex-parte order of the CIT(A). It remitted the matter back to the CIT(A) for fresh adjudication, directing that the assessee be given a further opportunity to present their case and cooperate in submitting necessary information.

The Tribunal, guided by Supreme Court precedent and its own prior rulings, affirmed that the situs of the AO dictates the appellate forum's jurisdiction. Since the AO concerned is located in Sirsi, which is outside the territorial jurisdiction of the Panaji Bench, the appeals were deemed not maintainable before this bench. The appeals were dismissed in limine with leave to file them before the appropriate ITAT Bench in Bengaluru.

Citing ITAT Standing Orders and Supreme Court precedent (PCIT Vs ABC Paper Ltd.), the Tribunal ruled that the situs of the Assessing Officer determines the appellate forum's jurisdiction. As the Sirsi AO fell outside the Panaji Bench's jurisdiction, the appeals were dismissed as not maintainable, with leave to file them before the appropriate ITAT Bengaluru Bench.

The Tribunal, noting the CIT(A)'s ex-parte dismissal and the assessee's claim of having a strong case on merits, decided to set aside the CIT(A)'s order. The case was remitted back to the CIT(A) for fresh adjudication, granting the assessee another opportunity to present its case.

The Tribunal ruled that the NFAC erred by dismissing the appeal in limine without considering the manual submissions and the condonation of delay petition. The case was remanded back to the NFAC with directions to consider the condonation of delay afresh and then adjudicate the appeal on merits after providing adequate opportunities.

The Tribunal, invoking principles of natural justice, set aside the CIT(A)'s ex-parte order. It remitted the matter back to the CIT(A) for fresh adjudication, granting the assessee another opportunity to present its case and substantiate its claims.

The Tribunal observed that the CIT(A) dismissed the appeal ex-parte for non-appearance. Recognizing the principles of natural justice and the possibility of valid reasons for non-compliance, the Tribunal set aside the CIT(A)'s order. The case was remitted back to the CIT(A) to adjudicate the issues afresh, providing the assessee another opportunity to present its case.

The tribunal set aside the penalty order, finding that the assessee was denied a reasonable opportunity to be heard, with notices providing less than seven days during the COVID-19 pandemic. It also noted the NFAC's failure to address substantive grounds regarding the applicability of Section 269SS or the existence of reasonable cause under Section 273B. The case was remanded to the Jurisdictional AO for de-novo consideration with adequate opportunities.

The Tribunal held that Section 80P(4) applies only to claimant assessees that are co-operative banks as defined in the Banking Regulation Act, 1949, which the assessee is not. It clarified that Section 80P(4) is a proviso meant to exclude co-operative banks functioning like commercial banks, and it does not jeopardize the claim of deduction for interest/dividend income received by a co-operative society from another co-operative society. The Tribunal concluded that the denial of deduction was untenable based on factual matrix and binding judicial precedents.

The Tribunal admitted additional evidence (cash book) filed by the assessee under Rule 29 of ITAT Rules. Given the importance of this evidence, the Tribunal restored the disputed issues back to the CIT(A) for fresh adjudication on merits, providing the assessee an opportunity to present the additional information.

The Tribunal found that the CIT(A) erred by overlooking the DVO report, which was submitted by the assessee during appellate proceedings and showed a lower valuation than the stamp duty authority. Citing principles of natural justice, the Tribunal restored the matter to the CIT(A) for fresh adjudication, instructing the CIT(A) to consider the DVO report and provide the assessee with an adequate opportunity of hearing.

The assessee opted for the 'Direct Tax Vivad se Vishwas Scheme, 2024' (VSVA Scheme) and submitted a letter requesting the withdrawal of the present appeal. The tribunal dismissed the appeal as withdrawn, granting leave to the assessee to revive the appeal if the issue remains unsettled under the VSVA Scheme.

The Tribunal, relying on judicial precedents from various High Courts (Karnataka and Gujarat) and co-ordinate benches of the ITAT, held that interest income earned by a cooperative society from its investments with other cooperative banks is eligible for deduction under Section 80P(2)(d) of the Act. The Supreme Court's decision in *Totgars* was distinguished as relating to Section 80P(2)(a)(i) and not 80P(2)(d). Consequently, the CIT(A)'s order was set aside, and the AO was directed to allow the deduction claim.

The Tribunal condoned the delay in filing the appeal. Recognizing the assessee challenged the ex-parte order and the additions, and upholding principles of natural justice, the Tribunal set aside the CIT(A)'s order and remitted the matter back to the CIT(A) for fresh adjudication, granting the assessee another opportunity to be heard.

The Tribunal found that the Ld. CIT(A)/NFAC provided only a 'paper opportunity' to the assessee, thereby denying a real and reasonable chance to present evidence. Citing judicial precedents, the Tribunal set aside the CIT(A)'s order and remitted the case back for a de-novo assessment, directing the Ld. NFAC to provide at least three effective hearing opportunities to the assessee.

The Income Tax Appellate Tribunal observed that since the assessee had opted for the DTVSV 2024 and sought to withdraw the appeal, no purpose would be served by keeping the appeal pending. Consequently, the tribunal dismissed the appeal as withdrawn, while granting the assessee liberty to move an application under Section 254(2) of the Act to recall the order in accordance with law.

The Income Tax Appellate Tribunal, considering the principles of natural justice, set aside the order of the CIT(A). The matter was remitted back to the CIT(A) for fresh adjudication, directing that the assessee be provided with adequate opportunity of hearing to substantiate their case.

The Income Tax Appellate Tribunal, Panaji Bench, dismissed the Revenue's appeal as 'not-maintainable', citing lack of territorial jurisdiction. The Tribunal relied on its own Rules, Standing Orders, and a Supreme Court judgment, determining that the 'situs of the assessing officer' is the decisive factor. As the AO is located in Sirsi, which falls outside the Panaji Bench's territorial limits, the appeal should be entertained by the Bangalore Bench.

The Tribunal found that the assessee's inability to reconcile the discrepancy was a curable issue attributable to third-party non-cooperation. Consequently, the Tribunal set aside the impugned order and remanded the specific issue concerning the reconciliation of income/figures and corresponding TDS credit as per Form 26AS back to the National Faceless Appeal Centre (NFAC) for de-novo adjudication, allowing the assessee another opportunity.

The Tribunal found that the CIT(A)/NFAC failed to conduct independent inquiries, ascertain the correctness of profit estimation, and violated principles of natural justice and Rule 46A of IT-Rules by not providing reasonable opportunity to the assessee. Although the assessee failed to explain the SBN deposits, the NFAC also did not provide adequate opportunity to furnish supporting evidence. Therefore, the Tribunal set aside the NFAC's order and remanded the matter for de-novo adjudication, ensuring the assessee gets an effective opportunity.

The Tribunal, noting the assessee's decision to resolve the matter via the DTVSV Scheme and the withdrawal application, dismissed the appeal as withdrawn. The assessee was granted liberty to apply u/Section 254(2) of the Act to recall the order if required.

The Tribunal dismissed the appeal as withdrawn, noting that the Revenue had no objection to the withdrawal. It granted the assessee leave to revive the appeal in accordance with the law if the dispute remains unsettled under the opted VSVA scheme for any reason.