ITAT Surat Judgments — June 2025

The CIT(A) found that the assessee had provided all necessary details and evidence, including bank statements and ITRs of the lenders, and had explained the source of the source. The AO had failed to consider these details and did not provide evidence to controvert the assessee's claim. The CIT(A) concluded that the addition was not justified.

The Tribunal held that the assessee, being a senior citizen and businessman with a history of filing returns for over 20 years, had substantial capital in his partnership firm and a declared cash-in-hand prior to demonetization, which the lower authorities had not duly considered. The Tribunal set aside the orders of the CIT(A) and AO and restored the matter to the AO for fresh assessment.

The Tribunal noted that the assessee's inability to comply with CIT(A)'s notices was due to the death of the President who was handling the tax matters. Considering the circumstances and the assessee's undertaking to be more vigilant, the case was restored to the CIT(A) for a fresh decision on merit.

The Tribunal held that Section 92BA(i) of the Act was omitted with effect from April 1, 2017, and therefore, could not be applied retrospectively to the Assessment Year 2016-17. The Tribunal followed decisions from the Hon'ble Karnataka High Court and ITAT Ahmedabad which had held similar adjustments to be invalid.

The Tribunal held that the enhanced rate under Section 115BBE is not applicable for AY 2017-18 for transactions prior to 01.04.2017. It allowed a further sum of Rs. 4,00,000/- from the withdrawal of Rs. 8,75,000/- made on 09.02.2016, in addition to the Rs. 8,63,000/- allowed by the CIT(A), directing the AO to delete Rs. 12,63,000/-.

The Tribunal noted that notices were indeed sent to an email address different from the one provided in Form No. 35. It was held that the non-representation was not intentional and that the interests of justice would be served by restoring the matter to the Assessing Officer for a de novo assessment.

The Tribunal held that the reopening of assessment was not based on reasonable belief but on a change of opinion, making it unsustainable. The Tribunal also noted that the issue of net profit estimation had attained finality in previous years. The CIT(A) exceeded its jurisdiction by re-adjudicating an issue that was not part of the original reassessment grounds.

The Tribunal found that while the entire explanation for the deposit was not acceptable, withdrawals made prior to demonetization, totaling Rs. 9,00,000/-, and Rs. 1,47,000/- for household expenses, were considered as explained sources. The remaining addition of Rs. 9,46,500/- was upheld, and the ground regarding Section 115BBE was allowed for AY 2017-18.

The Tribunal held that the reopening of assessment was not based on reasonable belief but on a change of opinion, making it unsustainable. The additions made by the AO and the CIT(A) regarding disallowance of URD purchases under Section 40A(3) were set aside.

The Tribunal found that the lower authorities passed ex-parte orders due to the assessee's non-compliance and that notices were issued to a wrong email address, violating the principles of natural justice. The appeals were set aside and restored to the AO for de novo orders.

The Tribunal found that the CIT(A) passed ex-parte orders due to non-compliance by the assessee. However, the assessee's AR provided evidence that notices were sent to a wrong email address, violating principles of natural justice. Therefore, the Tribunal set aside the CIT(A)'s order and restored the matter to the AO for fresh adjudication.

The Tribunal held that the re-opening of assessment was not based on "reason to believe" but on suspicion and change of opinion, which is not permissible. The Tribunal also noted that the issue of net profit estimation had already attained finality in previous proceedings. Furthermore, the CIT(A) exceeded jurisdiction by making additions on issues not subject to re-opening by the AO.

The Tribunal held that the re-opening of the assessment was not based on reasonable belief of income escapement but rather on a change of opinion and suspicion, making it unsustainable. Furthermore, there was no reliable evidence of cash payments violating Section 40A(3). The CIT(A)'s enhancement of net profits was also deemed unsustainable as the issue had attained finality in earlier proceedings.

The Tribunal dismissed the ground regarding the validity of reopening, finding no infirmity in the CIT(A)'s reasoning. Regarding the addition, the Tribunal considered that both parties agreed to a reasonable estimate and decided to estimate 20% of the total credits, directing the AO to add Rs. 1,67,716.

The Tribunal held that the reopening of assessment by the AO was not based on valid reasons, as it was based on suspicion and change of opinion rather than concrete evidence. The Tribunal also found that the additions made by the AO and the subsequent modifications by the CIT(A) lacked proper justification and evidence, particularly regarding the disallowance of purchases under section 40A(3) and the estimation of net profits.

The Tribunal held that the re-opening of assessment was not based on a reasonable belief of income escapement but on a change of opinion by the AO. The Tribunal also found no reliable evidence of cash payments in violation of Section 40A(3) of the Income Tax Act. The enhancement of net profits by the CIT(A) was also deemed unsustainable as the issue had previously attained finality. The Tribunal found no infirmity in the CIT(A)'s order setting aside the AO's disallowance under Section 40A(3).

The Tribunal held that the reopening of assessment by the AO was not based on a reasonable belief of income escapement but on a mere change of opinion, rendering it unsustainable. The CIT(A)'s action of making additions on issues not forming the basis of the reopening was also found to be without jurisdiction. For certain assessment years, the estimation of net profit was maintained at 3% as per earlier Tribunal decisions.

The Tribunal held that the re-opening of assessment by the AO was not based on a reasonable belief of income escapement, but rather on a change of opinion and suspicion, which is not permissible in law. The Tribunal found no reliable evidence of cash payments violating Section 40A(3). Regarding the estimation of net profits, the Tribunal noted that this issue had already attained finality in prior proceedings where the net profit rate of 3% was upheld. The CIT(A) exceeding its jurisdiction by re-estimating the profit was also noted.

The Tribunal held that the re-opening of assessment was not based on reasonable belief of escapement of income but on suspicion and change of opinion, thus quashing the reassessment. Regarding the merits, the Tribunal noted that the issue of net profit estimation had attained finality in prior proceedings. The CIT(A)'s enhancement of net profits was found unsustainable.

The Tribunal held that the reopening of assessment by the Assessing Officer was not based on a reasonable belief of escaped income but rather on a change of opinion and suspicion, rendering it unsustainable. The Tribunal also found no infirmity in the CIT(A)'s order in setting aside the disallowance made by the AO under Section 40A(3). Regarding the estimation of net profits, the Tribunal noted that this issue had attained finality in earlier proceedings.

The Tribunal held that the reopening of assessment under Section 147/148 was not based on 'reason to believe' but on a change of opinion, hence not sustainable. The additions made by the AO and subsequently modified by the CIT(A) were quashed. The Tribunal also noted that the issue of net profit estimation for earlier years had attained finality.

The Tribunal found that the lower authorities passed ex-parte orders due to the assessee's non-compliance. However, the assessee provided evidence that notices were sent to a wrong email address, indicating a violation of the principles of natural justice. Therefore, the Tribunal set aside the orders of the lower authorities.

The Tribunal held that the reopening of assessment by the AO was not sustainable as it was based on a change of opinion and lacked valid reasons to believe income had escaped assessment. The Tribunal further found no reliable evidence to support the disallowance of payments made in cash under Section 40A(3) of the Income Tax Act. Regarding the estimation of net profits, the Tribunal noted that this issue had already attained finality in earlier proceedings and the CIT(A) lacked jurisdiction to re-examine it.

The Tribunal set aside the CIT(A)'s order concerning the quantum addition and restored the matter to the Assessing Officer (AO) for a de novo assessment, granting the assessee an opportunity to present all relevant facts and documents. Consequently, the penalty under section 271AAC(1), being consequential, was deleted provisionally, with liberty granted to the AO to initiate fresh penalty proceedings if warranted after the de novo assessment.

The Tribunal held that the re-opening of assessment was not based on reasonable belief but on suspicion and change of opinion, thus not sustainable. It also noted that the CIT(A) exceeded his jurisdiction in making additions on issues not related to the original re-opening. The Tribunal further found no reliable evidence of violations under Section 40A(3) and noted that the issue of net profit estimation had already attained finality in previous proceedings.

At the outset of the hearing, the assessee's counsel stated that as per his client's instructions, he wished to withdraw the present appeal. Consequently, the appeal was dismissed as withdrawn.

The CIT(A) confirmed the addition made by the AO, dismissing the appeal solely on the grounds of non-compliance. The Tribunal found the CIT(A)'s order to be cryptic and violative of Section 250(6) of the Act, which mandates a reasoned order.

The Tribunal condoned the delay in filing the appeals. It found that the CIT(E)'s order was passed ex parte and violated the principles of natural justice. Therefore, the Tribunal set aside the order of the CIT(E) and remitted the matter back for fresh adjudication.

The Tribunal condoned the delay in filing the appeals, finding the reasons provided for the delay to be sufficient cause. The Tribunal set aside the order of the CIT(E) and remitted the matter back for fresh adjudication after granting adequate opportunity to the assessee.

The Tribunal found that the mistake in selecting the section code was inadvertent and the assessee was not given an opportunity to rectify it. The Tribunal set aside the order of the CIT(E) and directed them to allow the assessee to rectify the application and decide on its merits.

The Tribunal held that the mistake in filing the entry (incorrect section code) was not fatal and was an inadvertent mistake. The assessee was not given an opportunity to explain or cure the defect by the CIT(E). The Tribunal accepted the plea for correction and set aside the CIT(E)'s order.

The Tribunal condoned the delay in filing the appeals, finding it neither deliberate nor intentional. The Tribunal set aside the orders of the CIT(E) and remitted the matters back for a fresh decision, emphasizing the importance of natural justice and granting the assessee an adequate opportunity to present their case.

The Tribunal condoned the delays in filing the appeals, finding them to be neither deliberate nor intentional, and prioritizing substantial justice. The Tribunal observed that the assessee did not effectively pursue its case before the CIT(E) due to a failure to provide necessary documentary evidence. Therefore, the Tribunal set aside the orders of the CIT(E) and remitted the matters back for de novo consideration, directing the CIT(E) to grant adequate opportunity of hearing to the assessee.

The Tribunal found that the CIT(A) dismissed the assessee's appeal without providing an opportunity to rebut the remand report submitted by the AO, violating principles of natural justice. The Tribunal also noted a similar past order where an appeal was set aside. Therefore, the Tribunal restored the matter to the CIT(A) for a fresh decision after hearing the assessee.

The Tribunal found that the CIT(E) had not given the assessee adequate opportunity to be heard and had decided the case based on incomplete submissions. The Tribunal set aside the CIT(E)'s order and restored the matter for fresh adjudication.

The Tribunal noted that a previous order of the CIT(E) rejecting the Section 12A application had been set aside and remanded for fresh adjudication. Given this, and with no objection from the Revenue, the Tribunal set aside the current order of the CIT(E) and restored it for fresh consideration on merits.

The Tribunal noted that the assessee failed to appear or provide necessary documents, leading to an ex-parte order from the CIT(E). However, considering the principles of natural justice, the Tribunal decided to grant the assessee one more opportunity. Therefore, the order of the CIT(E) was set aside and the matter was remitted back for fresh adjudication.

The Tribunal condoned the delay in filing the appeals, finding that the reasons provided constituted a 'sufficient cause'. The Tribunal set aside the order of the CIT(E) and remitted the matter back for fresh adjudication, directing that adequate opportunity be given to the assessee.

The Tribunal held that income from land sales should be taxed as 'Profits and gains of business or profession' under Section 28, not capital gains, as the assessee was regularly dealing in land. It also found a clear violation of natural justice by the CIT(A) for not providing the assessee an opportunity to file a rejoinder to the AO's remand report. Consequently, the Tribunal set aside the CIT(A)'s order and remitted the matter back to the AO for fresh adjudication with adequate opportunity for the assessee to be heard.

The Tribunal found that the CIT(A) order was passed ex-parte due to the assessee's non-compliance and violation of natural justice. Although the assessee was negligent, the Tribunal, in the interest of justice, decided to give another opportunity for hearing.

The Tribunal, following decisions of the Gujarat High Court and ITAT, held that while the purchases might be bogus or accommodation entries, the disallowance should be restricted to 6% of the impugned purchases, not the full amount. The assessee's reliance on various case laws and the fact that similar additions were restricted to 6% in other cases involving the same groups were noted.

The Tribunal ruled that the CIT(A) violated principles of natural justice by not allowing the assessee to respond to the AO's remand report. It observed that the assessee was regularly engaged in land dealing, indicating that profit from land sales should be treated as 'Profits and gains of business or profession' under section 28, rather than capital gains. Consequently, the Tribunal set aside the CIT(A)'s order for all assessment years and remitted the matters back to the AO for fresh adjudication, ensuring adequate opportunity for the assessee to be heard.

The Tribunal found a clear violation of natural justice, noting that the CIT(A) failed to provide the assessee a copy of the remand report for rejoinder and an adequate opportunity of hearing, especially given her records were seized. It also observed that the assessee was regularly engaged in the business of land dealing and running a petrol pump, suggesting the income from land sales should be treated as business income. Consequently, all appeals were remitted back to the AO for fresh adjudication, with directions to grant the assessee a reasonable opportunity to present her case.

The Tribunal found that the CIT(A) violated principles of natural justice by not allowing the assessee to rebut the AO's remand report and by not considering the difficulties faced due to seized records. The Tribunal set aside the CIT(A)'s order and remanded the matter back to the AO for fresh adjudication, granting the assessee a proper opportunity to be heard.

The Tribunal held that the deduction under Section 36(1)(viia) is independent of the existence of rural branches and is available to eligible banks. Regarding Section 36(1)(viii), the assessee fulfilled all four conditions for claiming the deduction for creating a special reserve for long-term finance.

The Tribunal held that the difference of Rs. 3,00,000 between the sale consideration and the DVO's valuation of Rs. 72,00,000 is within the 10% tolerance band. Following previous ITAT decisions, the addition made by the AO was set aside.

The Tribunal noted that the plea of foreign remittances was raised for the first time before the CIT(A) and not before the AO. It was also observed that it was unclear whether Shri Tejas Mehta was a non-resident at the time of the transaction. The CIT(A) had not obtained a remand report from the AO regarding the additional evidence. Therefore, the Tribunal set aside the order of the CIT(A) and restored the matter to the file of the AO.

The Tribunal found that the AO had conducted a detailed inquiry, calling for explanations and examining evidence, and partially accepted the assessee's claims by enhancing the GP. Distinguishing between 'lack of inquiry' and 'inadequate inquiry', the Tribunal held that if the AO had undertaken some inquiry and taken a reasonable, plausible, and legally sustainable view, the PCIT could not invoke Section 263 merely on a difference of opinion. Citing Supreme Court precedents, the Tribunal concluded that the PCIT's finding that the AO's order was erroneous and prejudicial was incorrect.

The Tribunal noted that the assessee could not present its case before the CIT(E) due to not receiving notices and consequently not filing documents. The Tribunal found that the CIT(E) passed an order based on available materials. Upholding the principles of natural justice, the Tribunal decided to give the assessee another opportunity.