ITAT Surat Judgments — December 2025

The CIT(A) upheld the penalty, stating they had no power to grant immunity under section 270AA and that the assessee did not fall within the exceptions of section 270A(6). The Tribunal noted that the delay in filing Form 68 was only one day, a procedural lapse, and relied on previous decisions where such delays were not a bar to immunity.

The Tribunal held that the approach of the Ld. CIT(A) regarding the second issue (addition of Rs. 93,25,310/-) was unsustainable. The Tribunal reasoned that once an assessment is framed under Section 143(3), the correctness of adjustments forming part of the assessed income, including those from a prior Section 143(1) intimation, should have been examined by the AO during scrutiny. If raised before the CIT(A), these issues fall within his appellate jurisdiction. The CIT(A) was duty-bound to examine the claim on merits, either by calling for a remand report or adjudicating independently. Since the CIT(A) neither examined the factual claim nor called for verification, the Tribunal restored this issue to the file of the Assessing Officer for verification of the allowability of amounts under Section 43B, after affording the assessee an opportunity of being heard. Consequently, Ground No. 3 of the assessee's appeal was allowed for statistical purposes. The judgment does not explicitly state a finding or reasoning on the first issue (disallowance of interest under Section 36(1)(iii)), but the overall result indicates that the appeal was allowed for statistical purposes, implying that the issues were not finally decided on merits by the Tribunal, or that the primary relief was granted on the second issue.

The Tribunal found that while the buyers were identifiable, the genuineness of the cash explanation was doubtful. Therefore, the issue was restored to the AO for further inquiry.

The Tribunal held that the amendment brought by the Finance Act, 2022, regarding the application of accumulated funds, is prospective and does not apply to accumulations made prior to AY 2023-24. Therefore, the addition made by the AO and confirmed by the CIT(A) was not sustainable.

The Tribunal held that income from VDAs is taxed under section 115BBH at a flat rate of 30%, and this specific provision does not allow for the rebate under section 87A. While section 115BAC(1A) provides for a rebate under certain conditions, the income taxed under section 115BBH falls under a different regime and is therefore not eligible for the rebate under section 87A. The proviso to section 87A, effective from 1/04/2024, allows rebate when total income is chargeable under section 115BAC(1A) and does not exceed Rs. 7 lakh. However, the assessee's VDA income is taxed separately under section 115BBH, making the section 87A rebate inapplicable in this scenario.

The Tribunal held that the notice under Section 148 of the Income Tax Act was issued beyond the 'surviving time' as per the Supreme Court's directions in the Rajeev Bansal case, making it invalid. Consequently, the assessment order was quashed.

The Tribunal found that the reassessment proceedings were validly initiated. However, it directed the Assessing Officer to re-examine the issue of cash deposits, requiring the assessee to provide complete details of agricultural activities, expenses, and their sources.

The Tribunal upheld the addition of unexplained cash deposits under Section 68, finding the assessee's explanation improbable. However, to avoid double taxation, it directed that the corresponding sales credited in the books should be excluded from taxable income if the addition is sustained.

The Tribunal held that the notice under Section 148 of the Income Tax Act was issued beyond the 'surviving time' as per the Supreme Court's directions in the Rajeev Bansal case, making it invalid. Consequently, the assessment order was quashed.

The Income Tax Appellate Tribunal found an apparent inconsistency between the recitals in the registered sale deeds and the notarised possession letters regarding the timing and manner of cash payments for land purchase. The Tribunal held that the CIT(A)'s deletion of the addition was premature due to lack of detailed verification of documentary evidence and reconciliation of discrepancies. The matter was restored to the Assessing Officer for re-examination to verify date-wise cash payments, their sources, and reconciliation with registered instruments.

The CIT(A) set aside the AO's order and remanded the matter for fresh adjudication without deciding the jurisdictional and legal grounds raised by the assessee, specifically the issue of the notice being issued to a deceased person. The Tribunal held that the CIT(A) erred by not deciding the jurisdictional issue first.

The Tribunal noted that both the AO and CIT(A) passed ex-parte orders. The assessee contended that they were not given adequate opportunity of hearing due to circumstances beyond their control. The Tribunal, considering the interest of justice, decided to grant one more opportunity to the assessee.

The Tribunal held that the appeal was partly allowed. Regarding the addition of Rs. 35,00,000/-, the Tribunal acknowledged that the assessee operates in the transportation sector, which is largely unorganized and cash-intensive, and that retention money from drivers is a common practice. The Tribunal found that the deposits were recorded in the books of account, and the AO had not rejected the books. Therefore, the foundational precondition of 'not recorded in books' for section 69A was absent. However, the Tribunal found that the assessee had not substantiated the entire Rs. 35,00,000/- with adequate verifiable evidence. Considering the cash-intensive nature of the business and the need to plug revenue leakage, the Tribunal estimated an addition of Rs. 10,00,000/- as unexplained and unsubstantiated. This meant further relief of Rs. 25,00,000/- was granted, sustaining an addition of Rs. 10,00,000/-. The ground challenging the initiation of penalty proceedings under section 271(1)(c) was dismissed as premature, as no penalty had yet been levied, and the assessee would have an opportunity to contest it if and when levied.

The Tribunal admitted the additional evidence, acknowledging the assessee's reasonable cause for non-compliance due to counsel's actions and personal issues. However, it found some laxity on the assessee's part, leading to a partial reduction in the penalty.

The Tribunal admitted additional evidence due to substantial cause and the need for proper adjudication. Given the ex-parte proceedings and the relevance of the new evidence, the matter was restored to the AO for de novo examination.

The Tribunal held that the principle of consistency requires that if the department accepts a factual position in earlier years, it should not be disturbed in subsequent years without material change or contrary evidence. The assessee had consistently declared agricultural income in prior years which was accepted by the department. The documents submitted by the assessee substantiated the agricultural activity.

The Tribunal condoned the delay in filing the appeal, finding it not deliberate. While acknowledging the assessee's failure to provide satisfactory explanations for non-compliance before lower authorities, the Tribunal restored the matter to the CIT(A) to ensure principles of natural justice are met.

The tribunal noted that the AO relied on an investigation wing report stating the purchases were bogus. However, the assessee claimed the transactions were genuine and supported by evidence. The tribunal observed that the case might not have been properly adjudicated by the lower authorities.

The Tribunal noted that the PCIT passed the order under Section 263 without providing the assessee with adequate notice and opportunity for hearing, which violates principles of natural justice. Although the PCIT observed non-compliance with show-cause notices, the fact of non-service of these notices was not contested by the revenue.

The Tribunal condoned the delay in filing Form 10IC, noting technical glitches and a Gujarat High Court decision. The Assessing Officer was directed to process the assessee's return under Section 115BAA of the Act, subject to verification of other conditions, and to provide an opportunity for hearing.

The Tribunal found that the Assessing Officer and CIT(A) did not dispute the fact that the assessee, along with his brother, jointly owned and cultivated agricultural land. The assessee had provided details of agricultural produce and expenses, which were not disproved. The increase in income was attributed to the brother not taking his share in that particular year.

The Tribunal held that statutory notices issued to a deceased person are invalid and not legally sustainable. Proceedings conducted against a dead person are considered a nullity. Therefore, the assessment order passed under section 144 and the order of the CIT(A) are quashed.

The Tribunal held that the CIT(A) order was not sustainable as it was passed ex-parte without adjudicating on merits. The Tribunal admitted the additional evidence filed by the assessee as it was crucial for proper adjudication. The matter was remanded back to the CIT(A) for fresh adjudication.

The Tribunal noted the assessee's non-cooperation but found that the CIT(A) confirmed the addition without a proper hearing. The Tribunal decided to provide another opportunity to the assessee, subject to payment of costs.

The Tribunal considered the grounds of appeal concerning the disallowance of deduction u/s 80P(2)(d) on interest and dividend income earned from a cooperative bank. The Tribunal relied on the decisions of the Hon'ble Gujarat High Court in the cases of Ashwanikumar Arban Co-operative Society Ltd. and PCIT vs. Rajkot Lodhika Sahakari Kharid Vechan Sangh Ltd., which held that such income is eligible for deduction.

The Tribunal condoned the delay in filing the appeal before the CIT(A), noting that the CIT(A) had ignored the assessee's reasons for the delay and passed a non-speaking order without considering the merits. Consequently, the Tribunal remanded the issues back to the CIT(A) for proper adjudication and verification, ensuring an opportunity of hearing is provided to the assessee.

The Tribunal condoned the delay in filing the appeal, finding the reason genuine. It held that the CIT(E) erred in rejecting the application solely on the ground of delay, as the time limit had been extended by CBDT circulars. The Tribunal also noted that the merits of the application were not discussed.

The Tribunal noted that the assessee had subsequently provided details of cash withdrawal and deposit, along with supporting documents like bank statements and property deeds. Considering the interest of justice and fair play, the Tribunal felt that the assessee deserved another opportunity to present her case.