ITAT Pune Judgments — February 2026

The Tribunal held that the approval granted by the JCIT under Section 153D was not mechanical, as it was given year-wise after reviewing assessment records and draft orders, thus dismissing the assessee's challenge on this ground. Regarding the disallowance of expenses, the Tribunal noted that the Assessing Officer accepted the declared business income and did not treat it as income from other sources. The disallowance of routine business expenses like interest, stamping charges, etc., was considered incorrect. Considering the facts and in the interest of justice, the Tribunal directed the Assessing Officer to restrict the disallowance to 10% of the expenses for AY 2014-15. For the subsequent assessment years, where similar disallowances were made, the Tribunal applied the same reasoning and directed the Assessing Officer to restrict the disallowance to 10% of the expenses. The grounds raised by the assessee were accordingly partly allowed.

The Tribunal held that the approval granted by the JCIT under Section 153D was not mechanical, as it was given year-wise after reviewing assessment records and draft orders, thus dismissing the assessee's challenge on this ground. Regarding the disallowance of expenses, the Tribunal noted that the Assessing Officer accepted the declared business income and did not treat it as income from other sources. The disallowance of routine business expenses like interest, stamping charges, etc., was considered incorrect. Considering the facts and in the interest of justice, the Tribunal directed the Assessing Officer to restrict the disallowance to 10% of the expenses for AY 2014-15. For the subsequent assessment years, where similar disallowances were made, the Tribunal applied the same reasoning and directed the Assessing Officer to restrict the disallowance to 10% of the expenses. The grounds raised by the assessee were accordingly partly allowed.

The Tribunal held that the approval granted by the JCIT under Section 153D was not mechanical, as it was given year-wise after reviewing assessment records and draft orders, thus dismissing the assessee's challenge on this ground. Regarding the disallowance of expenses, the Tribunal noted that the Assessing Officer accepted the declared business income and did not treat it as income from other sources. The disallowance of routine business expenses like interest, stamping charges, etc., was considered incorrect. Considering the facts and in the interest of justice, the Tribunal directed the Assessing Officer to restrict the disallowance to 10% of the expenses for AY 2014-15. For the subsequent assessment years, where similar disallowances were made, the Tribunal applied the same reasoning and directed the Assessing Officer to restrict the disallowance to 10% of the expenses. The grounds raised by the assessee were accordingly partly allowed.

The Tribunal held that the approval granted by the JCIT under Section 153D was not mechanical, as it was given year-wise after reviewing assessment records and draft orders, thus dismissing the assessee's challenge on this ground. Regarding the disallowance of expenses, the Tribunal noted that the Assessing Officer accepted the declared business income and did not treat it as income from other sources. The disallowance of routine business expenses like interest, stamping charges, etc., was considered incorrect. Considering the facts and in the interest of justice, the Tribunal directed the Assessing Officer to restrict the disallowance to 10% of the expenses for AY 2014-15. For the subsequent assessment years, where similar disallowances were made, the Tribunal applied the same reasoning and directed the Assessing Officer to restrict the disallowance to 10% of the expenses. The grounds raised by the assessee were accordingly partly allowed.

The Tribunal condoned the 187-day delay in filing the appeal before the CIT(A), finding it not deliberate and noting that the assessee gained nothing from the delay. The case was restored to the CIT(A) for fresh adjudication on merits, as the CIT(A) had not previously considered the substantive issues.

The Tribunal condoned the 401-day delay in filing the appeal, finding "reasonable cause" as per the affidavit and Supreme Court precedent. On the merits, the Tribunal found that the disallowance u/s 40(a)(ia) was based on a clerical error in the Tax Audit Report, and since no such rent payment was made by the assessee, the disallowance was deleted, reversing the CIT(A)'s order.

The Tribunal found merit in the assessee's argument regarding the applicability of amended Section 153A for AY 2017-18. The CIT(A) had not properly considered the facts and legal grounds for AY 2017-18, leading to a non-speaking order.

The ITAT condoned the significant delay in filing the appeals before the CIT(A), considering the reasonable causes presented by the assessee. The Tribunal restored the matters to the file of the CIT(A) for adjudication on merits.

The Tribunal found merit in the assessee's argument regarding the applicability of amended Section 153A for AY 2017-18. The CIT(A) had not properly considered the facts and legal grounds for AY 2017-18, leading to a non-speaking order.

The ITAT condoned the significant delay in filing the appeals before the CIT(A), considering the reasonable causes presented by the assessee. The Tribunal restored the matters to the file of the CIT(A) for adjudication on merits.

The Income Tax Appellate Tribunal (ITAT) observed that since the assessee's declared income in response to a section 148 notice was accepted without any additions, and the assessee had a bona fide explanation, the income should not be treated as 'under-reported income' as per section 270A, particularly section 270A(6). Relying on the ITAT Hyderabad Bench decision in Subbalakshmamma Pinnama and maintaining consistency with the assessee's own case in a prior year where penalty was dropped on similar facts, the Tribunal directed the AO to delete the penalty levied under section 270A.

Given that the assessee had obtained the necessary relief, they sought to withdraw their appeals before the Tribunal. The Departmental Representative had no objection, and the Tribunal accepted the request, dismissing both appeals as 'withdrawn'.

The Tribunal found merit in the assessee's argument regarding the applicability of amended Section 153A for AY 2017-18. The CIT(A) had not properly considered the facts and legal grounds for AY 2017-18, leading to a non-speaking order.

Given that the assessee had obtained the necessary relief, they sought to withdraw their appeals before the Tribunal. The Departmental Representative had no objection, and the Tribunal accepted the request, dismissing both appeals as 'withdrawn'.

The Tribunal acknowledged that both the original assessment and the first appeal dismissal were ex-parte. Considering the assessee's contention that the ex-parte nature and delay were due to their erstwhile counsel's failure to inform them, and in the interest of justice, the Tribunal condoned the delay in the current appeal. It set aside the CIT(A)'s order and restored the entire matter to the Assessing Officer for fresh assessment, directing the AO to provide a reasonable opportunity of hearing and the assessee to comply with notices.

Despite the assessee's repeated non-appearance before the lower authorities and the Tribunal, the Tribunal decided to grant one more opportunity in the interest of justice. All issues raised in the appeal are restored to the file of the Ld. CIT(A) for fresh adjudication, with directions to afford a reasonable opportunity of being heard to the assessee.

The Tribunal condoned the 95-day delay in filing the appeal before the CIT(A), relying on a justice-oriented approach and Supreme Court judgments. It remitted the issue regarding the addition of ₹ 59,00,333 back to the CIT(A) for fresh adjudication under section 250(6), directing the CIT(A) to provide a reasonable opportunity of being heard to the assessee.

The Tribunal set aside the ex-parte order of the CIT(A) and restored the matter to the CIT(A) for fresh adjudication. The assessee was directed to cooperate by responding to notices and providing evidence, ensuring a reasonable opportunity of hearing.

The Tribunal found that the assessee had indeed filed an affidavit for condonation of delay, which the CIT(A) had overlooked. The ITAT restored the matter to the file of the CIT(A) / NFAC with directions to consider the condonation affidavit and decide the appeal on its merits.

The Tribunal found that the assessee had indeed filed an affidavit for condonation of delay, which the CIT(A) had overlooked. The ITAT restored the matter to the file of the CIT(A) / NFAC with directions to consider the condonation affidavit and decide the appeal on its merits.

The Tribunal noted that the assessee maintained proper books of accounts, quantitative details, and filed VAT returns, and the gross sales were accepted by the AO. It held that the comparison of cash sales for fixed dates across different financial years was flawed due to the varying dates of the Diwali festival. The Tribunal found that the assessee successfully explained the source of cash and established an increasing trend in cash sales consistent with a 40% increase in gross sales. Consequently, the addition made under section 69A was deleted.

The Tribunal dismissed the appeal. Regarding the disallowance of depreciation on Goodwill (Issue 1), the Tribunal held that the creation of Goodwill was an artificial creation and a colourable device to evade tax by claiming depreciation. The AO's observation that the amalgamation was between two 100% subsidiaries and that the shareholders of the amalgamating company received more shares in the swap ratio indicated a valuation made to suit the needs of amalgamation, not a genuine creation of goodwill. The Tribunal agreed with the AO that the Goodwill and depreciation claimed thereon were not sustainable. Consequently, the disallowance of depreciation on Goodwill was upheld. On the issue of Buy Back Tax (Issue 2), the Tribunal found no justification in the assessee's working of distributable income. It reiterated its finding that the Goodwill was artificially created and a colourable device to evade tax. Therefore, the net assets of MLPL should be considered without the artificially created Goodwill. The AO's calculation of distributable income and the levy of tax under Section 115QA were upheld, confirming the CIT(A)'s finding that the arrangement was a colourable transaction to buy back shares instead of paying dividend and evade taxes. Ground No. 2 was dismissed. Regarding the deduction for Education Cess (Issue 3), the assessee did not press this ground, and it was dismissed as 'Not Pressed'.

Considering the facts, circumstances, and practical difficulties faced by the assessee during the COVID-19 pandemic, the Tribunal decided to grant another opportunity. The matter was remitted back to the Jurisdictional Assessing Officer to verify the assessee's claim for deduction u/s 43B for the payment made in FY 2020-21 and to confirm if similar disallowances were made in prior assessment years. If the claim is found to be correct upon verification, the JAO is directed to allow it.

The Tribunal determined that the total salary expense of Rs.41,27,199/- claimed by the assessee was correct and allowable. It directed the Assessing Officer to re-compute the deduction under Section 80IA by apportioning the salary expenses between the power generation unit and the share trading business based on their respective turnovers, considering this a scientific method.

Considering the larger interest of justice, the ITAT restored the issues raised in the appeal on merits to the file of the Ld.CIT(A) for fresh adjudication. The CIT(A) is directed to pass a speaking order under section 250(6) of the Act after granting a fair hearing opportunity to the assessee, who is also directed to remain vigilant.

The Tribunal held that interest earned by a co-operative society from investments/deposits with co-operative banks is eligible for deduction under Section 80P(2)(d) of the Income Tax Act, 1961. Consequently, the disallowance by the lower authorities was set aside.

The Tribunal restored the matter to the Ld. Jurisdictional Assessing Officer (JAO) for limited verification. The assessee is directed to furnish necessary evidence, including Form 16, and a revised income computation without claiming the deposited excess refund as prepaid tax. The JAO shall provide a reasonable opportunity and decide the issues in accordance with law.

The Tribunal held that a profit rate of 2% on the deposits would be a reasonable estimation of commission income, setting aside the CIT(A)'s order. The assessee's cross-objection was dismissed as not pressed.

The Tribunal observed that in the absence of details regarding the assessee's income for the preceding A.Y. 2019-10, the advance tax liability could not be quantified, thus the CIT(A) should have adjudicated the case on its merits. Consequently, the Tribunal restored the issues back to the file of the CIT(A) for fresh adjudication on merits under section 250(6) of the Act, after providing the assessee a reasonable opportunity of hearing.

The Tribunal found that the CIT(A)/NFAC's dismissal of the appeal for non-prosecution, without addressing the merits and stating reasons, violated Section 250(6) of the Income Tax Act. Consequently, the Tribunal set aside the CIT(A)/NFAC's order and remanded the matter back for fresh adjudication on merits, providing the assessee a final opportunity of hearing.

The Tribunal, considering the request for an additional opportunity and in the interest of justice, decided to grant the assessee one more chance to present their case before the ld. CIT(A). The issues raised in the appeal are remitted back to the file of the ld. CIT(A) for fresh adjudication, with a direction for the CIT(A) to provide due opportunity of hearing. The assessee is also directed to be vigilant and ensure compliance with notices.

The Tribunal held that interest earned by a co-operative society from investments/deposits with co-operative banks is eligible for deduction under Section 80P(2)(d) of the Income Tax Act, 1961. Consequently, the disallowance by the lower authorities was set aside.

The Tribunal held that the late fees under Section 234E should be calculated only from June 1, 2015, onwards, as the provision was introduced with effect from that date. The matter was restored to the Jurisdictional TDS Officer for re-calculation.

The Tribunal determined that the bank transactions were business-related and only the profit element should be added to the assessee's income. The matter was restored to the AO for due verification of the assessee's total turnover and for estimation of Net Profit, with the condition that the estimated profit should not exceed the rate provided under Section 44AD of the Act or the peak credit balance in the bank account, whichever is less.

The Tribunal held that the late fees under Section 234E should be calculated only from June 1, 2015, onwards, as the provision was introduced with effect from that date. The matter was restored to the Jurisdictional TDS Officer for re-calculation.

The Tribunal held that the assessee's activities fall under the 'preservation of environment' category, which is inherently charitable and distinct from 'advancement of any other object of general public utility'. The Tribunal found no change in circumstances since previous registration was granted.

The ITAT, relying on a Bombay High Court judgment, held that the CIT(A) is obligated to decide appeals on merits and cannot dismiss an appeal merely for non-prosecution. Consequently, the ITAT set aside the CIT(A)'s order and remanded the matter for de novo adjudication, instructing the CIT(A) to provide the assessee an opportunity to present documents.

The Tribunal restored the matter to the Ld. Jurisdictional Assessing Officer (JAO) for limited verification. The assessee is directed to furnish necessary evidence, including Form 16, and a revised income computation without claiming the deposited excess refund as prepaid tax. The JAO shall provide a reasonable opportunity and decide the issues in accordance with law.

The ITAT, relying on a Bombay High Court judgment, held that the CIT(A) is obligated to decide appeals on merits and cannot dismiss an appeal merely for non-prosecution. Consequently, the ITAT set aside the CIT(A)'s order and remanded the matter for de novo adjudication, instructing the CIT(A) to provide the assessee an opportunity to present documents.

The Tribunal held that the notice under Section 148 was issued after the permissible period, based on a concession made by the Revenue before the Supreme Court in the case of Deepak Steel & Power Ltd. Therefore, the reassessment order was deemed bad in law.

The Tribunal held that while the assessee failed to provide complete evidence, the entire deposit should not be treated as income. It directed the Assessing Officer to consider 2% of the deposit as income, acknowledging the lack of evidence of lavish expenditure or investments by the assessee.

The Tribunal held that since the excess stock was directly related to the assessee's jewelry business and no other activities were detected, it should be taxed as business income, not as an unexplained investment. The Tribunal also reversed the CIT(A)'s partial relief on certain expense disallowances.

The Tribunal held that the late fees under Section 234E should be calculated only from June 1, 2015, onwards, as the provision was introduced with effect from that date. The matter was restored to the Jurisdictional TDS Officer for re-calculation.

The Tribunal condoned the delay in filing the appeal. It held that there was a bonafide inadvertent error in selecting the correct clause for the application and that the CIT(E) should have considered the CBDT Circular No. 6 of 2023. The Tribunal set aside the CIT(E)'s order and restored the matter for fresh consideration.

The Tribunal held that the late fees under Section 234E should be calculated only from June 1, 2015, onwards, as the provision was introduced with effect from that date. The matter was restored to the Jurisdictional TDS Officer for re-calculation.

The Tribunal held that the penalty notice did not specify which limb of Section 270A was attracted and that the assessee's claims were due to inadvertent mistakes rather than misreporting. Therefore, the penalty was not exigible.

The Tribunal held that the late fees under Section 234E should only be calculated from June 1, 2015, onwards, as the provision was introduced with effect from that date. The matter was restored to the Jurisdictional TDS Officer for recalculation.

The Tribunal held that the late fees under Section 234E should be calculated only from June 1, 2015, onwards, as the provision was introduced with effect from that date. The matter was restored to the Jurisdictional TDS Officer for recalculation.

The Tribunal held that while the assessee failed to provide complete evidence, the entire deposit should not be treated as income. It directed the Assessing Officer to consider 2% of the deposit as income, acknowledging the lack of evidence of lavish expenditure or investments by the assessee.

The Tribunal held that the denial of exemption under Section 11 by the CPC was not justified, especially as the delay in filing Form 10B was condoned by the CIT(A). The Tribunal followed its coordinate bench decisions which held that filing of Form 10B is directory and not mandatory, and exemption should not be denied for a delay.