ITAT Raipur Judgments — October 2025

The Tribunal quashed the PCIT's revisionary order, holding that the PCIT violated principles of natural justice by not confronting the assessee with adverse information and by disregarding corroborative evidence provided by the assessee. The Tribunal found that the PCIT passed the order based on external information without proper examination and opportunity for the assessee to rebut, rendering the Section 263 order unsustainable.

The Tribunal held that Section 234E is a charging provision that cannot be applied retrospectively without express provision. The mechanism for computing late fees under Section 200A was introduced by the Finance Act, 2015, effective from 01.06.2015, meaning there was no enabling power to impose such fees prior to this date. Relying on the Karnataka High Court's ruling in *Fatheraj Singhvi*, the Tribunal concluded that late fees under Section 234E are leviable only prospectively from 01.06.2015. Thus, the demand notices issued under Section 200A for the period prior to 01.06.2015 were without authority of law.

The Tribunal held that Section 234E, along with the mechanism under Section 200A for computing and demanding late fees, is prospective in nature, effective from 01.06.2015. Relying on the Karnataka High Court decision in *Fatheraj Singhvi v. Union of India*, it concluded that no late fees could be legally levied for periods prior to this date. Consequently, the demand notices issued under Section 200A for A.Y. 2014-15 were deemed to be without authority of law and were quashed.

The Tribunal held that Section 234E is a substantive charging provision and the enabling mechanism for computing late fees under Section 200A was introduced with prospective effect from 01.06.2015. Relying on the Karnataka High Court's judgment in Fatheraj Singhvi, it concluded that the department lacked the authority to impose late filing fees for periods prior to this date. Therefore, the demand notices issued for A.Y.2014-15 were deemed invalid and quashed.

Relying on the Bombay High Court decision in CIT Vs. Premkumar Arjundas Luthra (HUF), the ITAT ruled that an appellate authority cannot dismiss an appeal in limine for non-prosecution and is obliged to dispose of appeals on merits. Consequently, the ITAT set aside the CIT(A)'s order and remanded the matter for de novo adjudication on merits, granting the assessee a final opportunity.

The Tribunal held that the lower authorities' rejection of the assessee's explanation was arbitrary and based on mere suspicion, without conducting necessary inquiries or bringing forth negating facts. The revenue failed to prove that the deposited money was from an undisclosed source, especially since the initial withdrawal was from a declared source. Consequently, the addition made under Section 69A was deemed misplaced.

The ITAT granted the assessee's request for admission of additional evidence. Consequently, the matter was remanded to the CIT(Appeals)/NFAC for de novo adjudication after obtaining a remand report from the Assessing Officer, as per Rule 46A(3) of the Income Tax Rules, 1962, ensuring adherence to natural justice principles.

The Tribunal dismissed the assessee's legal ground, holding that only one prior approval from the specified authority under Section 148A(d) is required before issuing a notice u/s 148, and the first proviso to Section 148 does not mandate a separate approval. On merits, the Tribunal agreed with the Pr. CIT that the AO failed to conduct full and complete inquiries, specifically regarding the excess shortage of diesel, making the original assessment erroneous and prejudicial to revenue. The Tribunal therefore upheld the Pr. CIT's order u/s 263, setting aside the assessment to the AO for fresh assessment.

The Tribunal condoned the delay in filing the appeal, finding it unintentional and supported by valid reasons. It ruled that the ex-parte order by the CIT(A) violated natural justice principles. The matter was remanded to the CIT(A) for fresh adjudication on merits, granting the assessee a final opportunity to be heard.

The tribunal condoned the 97-day delay in filing the appeal, adopting a liberal approach. It remanded the issue of PDS income to the A.O. for re-evaluation, instructing to consider expenses against gross receipts to determine the net taxable value. For the interest income from the co-operative bank, the tribunal held that it is eligible for deduction under section 80P(2)(d) of the Income Tax Act, citing judicial precedents.

The Tribunal, relying on the jurisdictional High Court's judgment in `Sanjay Kumar Baid`, held that Section 96 of the RFCTLARR Act, which provides for exemption from income tax, is applicable to land acquired under the National Highways Act, 1956. Consequently, the compensation received from the NHAI for such land acquisition is not exigible to tax. The assessee is therefore not liable to pay income tax on the amount of compensation.

The Tribunal upheld the CIT(A)'s order, finding that the assessee had correctly added back the provision for bad and doubtful debts to its taxable income only once. The AO's addition of Rs. 17,00,00,000/- was based on a misconception of a double claim, which the CIT(A) had rightly deleted after verifying the facts from records. The Tribunal concurred that the assessee's claim was a one-time deduction allowable under the Act.