ITAT Pune Judgments — August 2023

The Tribunal dismissed the appeals of both assessees. Regarding the jurisdiction under section 153C, the Tribunal upheld the CIT(A)'s findings, implicitly agreeing that the notices were validly issued. On the issue of cash deposits and investments, the Tribunal found that the assessees failed to provide documentary evidence to support their claim of agricultural income from the HUF. The bank accounts were in the names of the individuals, not the HUF, and no income tax return was filed by the HUF. The Tribunal held that the cash deposited in the assessee's bank account was established as the assessee's own money, and the source was not explained. Therefore, additions were correctly made in the hands of the assessees under section 69A of the Act. The Tribunal rejected the plea that details of cash deposits were not provided, stating the assessees had access to their bank accounts and investment details. The Tribunal also upheld the CIT(A)'s power to invoke section 69A, citing the Supreme Court's decision in CIT vs Kanpur Coal Syndicate. For Santosh Mahadeo Navale, the issue of the actual quantum of cash deposits was set aside to the AO for verification, but the principle of addition was confirmed. The Tribunal dismissed the grounds of appeal, finding no infirmity in the CIT(A)'s orders.

The Tribunal dismissed the appeals of both assessees. Regarding the jurisdiction under section 153C, the Tribunal upheld the CIT(A)'s findings, implicitly agreeing that the notices were validly issued. On the issue of cash deposits and investments, the Tribunal found that the assessees failed to provide documentary evidence to support their claim of agricultural income from the HUF. The bank accounts were in the names of the individuals, not the HUF, and no income tax return was filed by the HUF. The Tribunal held that the cash deposited in the assessee's bank account was established as the assessee's own money, and the source was not explained. Therefore, additions were correctly made in the hands of the assessees under section 69A of the Act. The Tribunal rejected the plea that details of cash deposits were not provided, stating the assessees had access to their bank accounts and investment details. The Tribunal also upheld the CIT(A)'s power to invoke section 69A, citing the Supreme Court's decision in CIT vs Kanpur Coal Syndicate. For Santosh Mahadeo Navale, the issue of the actual quantum of cash deposits was set aside to the AO for verification, but the principle of addition was confirmed. The Tribunal dismissed the grounds of appeal, finding no infirmity in the CIT(A)'s orders.

The Tribunal dismissed the appeal. Regarding the validity of the Section 153C notice and jurisdiction, the Tribunal implicitly upheld the AO's actions by not finding fault with the assessment proceedings. The core of the decision revolved around the assessee's claim of agricultural income from HUF. The Tribunal found that the assessee failed to provide any documentary evidence, such as 7/12 extracts, to prove ownership of land or agricultural income. The confirmation from the Karta of the HUF was deemed insufficient without corroborative evidence. The Tribunal noted that the bank accounts where deposits were made were not in the name of the HUF, and no income tax return was filed by the HUF. The Tribunal applied Section 69A of the Act, stating that once the department unearths money for which the assessee cannot satisfactorily explain the source, it becomes deemed income. The Tribunal agreed with the CIT(A) invoking Section 69A, noting that the appellate powers are coterminous with the AO. The plea that details of cash deposits were not provided was rejected as the bank accounts and investments were in the assessee's name. The Tribunal upheld the additions made by the AO and confirmed by the CIT(A), dismissing all grounds of appeal.

The Tribunal held that for an individual to be considered a legal representative under Section 159 of the Income Tax Act, they must represent the estate of the deceased. Since the applicant failed to demonstrate that he represented the estate, his petition to be impleaded as the legal representative was rejected.

The Tribunal condoned the delay in filing the appeal. It found that the lower authorities had not considered the assessee's submission that the cash deposits were made from fees collected for repayment to the university.

The Tribunal held that since the additional income was accepted as business receipts and offered under the head 'income from business', the source was explained. Therefore, Section 115BBE was not applicable.

The Tribunal held that the delay in filing the appeal before the NFAC was due to pursuing an alternative remedy (Section 154 application), which constitutes a reasonable cause. The NFAC was not justified in dismissing the appeal in limine without condoning the delay.

The Tribunal held that the NFAC's order was cryptic and passed without considering the merits of the case. It also noted that the assessee might have been prevented from appearing due to COVID-19 related difficulties.

The Tribunal held that while statements recorded during a survey can be used for assessment, the addition of the entire amount was not justified. The case was restored for de novo assessment to determine the correct addition.

The Tribunal held that the re-assessment proceedings were valid. However, on merits, the Tribunal found that the expenses incurred on the development of the sold flat were genuine and should not have been disallowed.

The Tribunal held that the CIT(A) had not properly adjudicated the assessee's rectification plea and had not established a clear nexus between the Vivad se Vishwas settlement and the rectification sought. The appeal was restored to the CIT(A) for fresh adjudication.

The tribunal condoned the delay in filing the appeal. Considering the interest of justice and the assessee's request for another opportunity, the issue was remanded to the Pr. CIT for fresh consideration.

The Tribunal upheld the CIT(A)'s decision to treat the unsecured loans as unexplained cash credits under Section 68. The assessee failed to discharge its onus of proving the genuineness of these loans, despite the admission of related parties.

The Tribunal set aside the ex parte order of the CIT(A) and remitted the matter back for a fresh decision. The CIT(A) was directed to provide the assessee with a reasonable opportunity of hearing.

The Tribunal held that only the profit element of the bogus purchases should be added, not the entire amount. Following a jurisdictional High Court precedent, the addition was restricted to 10% of the purchase amount.

The Tribunal found that the assessee's activities, such as providing food to the poor during Covid-19 and assisting with funeral expenses, were charitable in nature and aligned with the trust's objects. The rejection based on inadequate evidence was deemed unjustified.

The Tribunal held that the addition could only be made in the year the credit first appeared in the books. Since this was not examined by the lower authorities, the matter was remanded for fresh adjudication.

The Tribunal found that the NFAC had confirmed the Assessing Officer's findings without independent application of mind or considering the assessee's written submissions, violating principles of natural justice. Therefore, the matter was remitted to the NFAC for fresh adjudication.

The Tribunal set aside the CIT(A)'s order and remanded the matter back for fresh adjudication. This was done because certain issues raised by the assessee were not dealt with by the CIT(A), and the Revenue did not object to a remand.

The Tribunal set aside the CIT(A)'s order and remanded the matter back for fresh adjudication. This was done because certain issues raised by the assessee were not dealt with by the CIT(A), and the Revenue did not object to a remand.

The Tribunal set aside the CIT(A)'s order and remanded the matter back for fresh adjudication. This was done because certain issues raised by the assessee were not dealt with by the CIT(A), and the Revenue did not object to a remand.

The Tribunal set aside the CIT(A)'s order and remanded the matter back for fresh adjudication. This was done because certain issues raised by the assessee were not dealt with by the CIT(A), and the Revenue did not object to a remand.

The Tribunal found that the appeals were decided ex parte and that the assessee alleged inadequate opportunity. Therefore, the Tribunal set aside the CIT(A)'s orders and remitted the matters back for fresh adjudication.

The Tribunal found that the appeals were decided ex parte and that the assessee alleged inadequate opportunity. Therefore, the Tribunal set aside the CIT(A)'s orders and remitted the matters back for fresh adjudication.

The Tribunal held that Section 80P(4) does not affect the eligibility of a cooperative society for deduction under Section 80P(2)(d) on interest income earned from deposits with a registered cooperative bank.

The Tribunal held that the delay in proceedings was not attributable to the assessee as contemplated under Section 244A(2) of the Income Tax Act. The AO should have calculated and paid the interest on the refund immediately after the rectification order.

The Tribunal found that the CIT(A) had not properly adjudicated the assessee's grounds of appeal. Therefore, the appeal was allowed for statistical purposes, and the matter was remanded back to the CIT(A) for fresh adjudication.

The Tribunal noted that the assessee's counsel conceded that the present appeals involved identical facts and grounds as previous appeals decided against the assessee. Following the earlier decisions, the Tribunal dismissed the current appeals.

The Tribunal held that a statement recorded under Section 132(4) has binding force and can be treated as evidence. Since the assessee surrendered the amount and did not include it in the return, the addition was justified.

The Tribunal acknowledged the submissions of both the learned AR and the learned DR. The learned AR for the assessee fairly confessed that the present matters were covered against the assessees by earlier orders of the Tribunal, which dealt with identical facts and circumstances and identical issues. The Tribunal found no dispute regarding this submission. Respectfully following the earlier decisions of the Tribunal on the same parity of reasoning, the Tribunal dismissed all the grounds of appeal raised by the assessees. The operative direction was the dismissal of both appeals.

The Tribunal held that the CIT(A) was justified in deleting the addition of Rs. 1,88,28,183/- made on a protective basis. The AO failed to conduct necessary inquiries to establish that the 'Vijay Shah Saheb' mentioned in the seized loose papers was indeed the assessee. The assessee consistently denied this and stated he did not know the person. Without such verification, the AO arbitrarily made the addition. Therefore, the Revenue's appeal was dismissed. Regarding the assessee's appeal, the Tribunal noted that its reasoning for dismissing the Revenue's appeal regarding the identity of 'Vijay Motmal Shah' applied here as well. Consequently, the addition of Rs. 24,000/- confirmed by the CIT(A) on account of unexplained investment was not justified and was deleted. The addition of Rs. 16,20,000/- confirmed by the CIT(A) on account of unexplained investment was also deleted for the same reason. Ground No. 3 became infructuous. Ground No. 4 regarding interest under Sections 234A, 234B, and 234C was dismissed as consequential. The assessee's appeal was allowed.

The Tribunal held that once income is credited to the Profit & Loss account, it is presumed to be business income, and the Assessing Officer failed to provide evidence to the contrary. The Tribunal distinguished the relied-upon High Court decisions as not applicable to the present facts.

The Tribunal held that the CIT(A) erred by not calling for a remand report on the additional evidence filed by the assessee and by concluding that the agricultural income was not credible solely because no return was filed. The Tribunal found no statutory obligation to file a return if income did not exceed the taxable limit.

The Tribunal held that the AO failed to conduct proper inquiries to establish the assessee's involvement in the land transactions mentioned in the seized papers. Therefore, the additions made on a protective basis were unjustified.

The Tribunal upheld the Principal CIT's view, stating that foreign exchange loss on loans for capital assets is not deductible as per Supreme Court judgment. The Assessing Officer erred by allowing this deduction without proper inquiry.

The Tribunal held that the CIT (Exemption) erred in invoking Section 263 jurisdiction. The assessment order could not be termed erroneous and prejudicial to the revenue as the issues raised by the CIT were outside the scope of the original reassessment proceedings.

The Tribunal held that no disallowance under Section 14A can be made in the absence of any exempt income, as the amendment by the Finance Act, 2022, is prospective. The issue of depreciation on cars was remitted back to the CIT(A) for fresh adjudication.

The Tribunal found it just and fair to set aside the ex parte order. The matter was remitted to the CIT(A) for a fresh decision after providing a reasonable opportunity of hearing to the assessee.

The Tribunal held that the PCIT erred in invoking Section 263. The reassessment order was not erroneous as the AO had made a plausible view and no addition was made on the core issue. The PCIT cannot direct initiation of penalty proceedings under Section 269SS during revision.

The Tribunal held that the issue regarding the eligibility of deduction under Section 80P(2)(a)(i) and 80P(2)(d) for interest income earned on investments with cooperative banks was covered in favour of the assessee by judicial precedents. Therefore, the assessment order could not be considered erroneous or prejudicial to the revenue's interest.

The Tribunal found it just and fair to set aside the CIT(A)'s ex-parte order. The matter was remitted back to the CIT(A) with a direction to decide the appeal afresh after providing a reasonable opportunity of hearing to the assessee.

The Tribunal upheld the PCIT's order, agreeing that the AO's assessment order was erroneous and prejudicial to the revenue due to a lack of inquiry and verification on crucial issues like interest on TDS and deemed rental income on unsold stock.

The Tribunal noted the assessee's failure to provide documentary evidence and submissions before the NFAC. However, in the interest of justice, a final opportunity was granted to the assessee to furnish relevant details.

The Tribunal held that while the assessee was eligible for TDS credit under Section 155(14), it could only be claimed proportionally to the income offered in the original return, not the full rent received.

The Tribunal held that the interest income received under Section 28 of the Land Acquisition Act, 1894, is taxable under Section 56(2)(viii) of the Income Tax Act, 1961. The Tribunal followed the jurisdictional High Court's decision which held this interest income as taxable.

The Tribunal held that Section 234E, which allows for the levy of late fees, was inserted with effect from June 1, 2015. Therefore, the fee can only be levied for defaults committed after this date.

The Tribunal held that Section 234E, which allows for the levy of late fees, was inserted with effect from June 1, 2015. Therefore, the fee can only be levied for defaults committed after this date.

The Tribunal held that for AY 2009-10, which was an unabated assessment year, the Assessing Officer (AO) could not make additions under Section 143(3) read with Section 153A without incriminating material found during the search. The Tribunal found that the documents relied upon by the revenue, such as approvals from the Pune Municipal Corporation and Index-II of sale agreements, did not constitute incriminating material. The Tribunal distinguished the case law cited by the revenue regarding block assessments. Therefore, Revenue's Grounds 8 and 9 were dismissed. Regarding the allowability of deduction under Section 80IB(10), the Tribunal noted that the assessee claimed three different housing projects ('Shiv-Sagar City (phase I)', 'Shivsagar residency (phase II)', 'Shiv-sagar Platinum (phase III)') on a large plot of land. The assessee demonstrated separate building plan approvals and completion certificates for each project, arguing they were independent. The revenue contended they were part of a single project based on a single 'Lay Out Plan'. The Tribunal observed that the initial lay out plan showed specific buildings, and commencement certificates were issued for these. Part Occupancy Certificates were issued for various buildings, indicating completion of residential units and parking. The Tribunal agreed with the Ld. CIT(A) that there was no incriminating material found during the search for AY 2009-10. The Tribunal did not decide on the merits of the other grounds related to Section 80IB(10) violations (grounds 1-7 and additional grounds of revenue, and cross-objection ground 1) as the primary issue of incriminating material for the unabated year was decided. The issue of facilitation/commission income (Ground 10) was also not decided on merits.

The Tribunal held that for AY 2009-10, which was an unabated assessment year, the Assessing Officer (AO) could not make additions under Section 143(3) read with Section 153A without incriminating material found during the search. The Tribunal found that the documents relied upon by the revenue, such as approvals from the Pune Municipal Corporation and Index-II of sale agreements, did not constitute incriminating material. The Tribunal distinguished the case law cited by the revenue regarding block assessments. Therefore, Revenue's Grounds 8 and 9 were dismissed. Regarding the allowability of deduction under Section 80IB(10), the Tribunal noted that the assessee claimed three different housing projects ('Shiv-Sagar City (phase I)', 'Shivsagar residency (phase II)', 'Shiv-sagar Platinum (phase III)') on a large plot of land. The assessee demonstrated separate building plan approvals and completion certificates for each project, arguing they were independent. The revenue contended they were part of a single project based on a single 'Lay Out Plan'. The Tribunal observed that the initial lay out plan showed specific buildings, and commencement certificates were issued for these. Part Occupancy Certificates were issued for various buildings, indicating completion of residential units and parking. The Tribunal agreed with the Ld. CIT(A) that there was no incriminating material found during the search for AY 2009-10. The Tribunal did not decide on the merits of the other grounds related to Section 80IB(10) violations (grounds 1-7 and additional grounds of revenue, and cross-objection ground 1) as the primary issue of incriminating material for the unabated year was decided. The issue of facilitation/commission income (Ground 10) was also not decided on merits.

The Tribunal held that Section 234E, which allows for the levy of late fees, was inserted with effect from June 1, 2015. Therefore, the fee can only be levied for defaults committed after this date.