ITAT Surat Judgments — October 2026

The Tribunal held that the penalty imposed under Section 271(1)(c) is unsustainable in law. The reasoning was based on the established principle that penalty is not exigible when additions to income are made or sustained on an ad hoc or estimated basis. The Tribunal noted that the additions in this case had undergone a series of estimations at all appellate levels, starting from the AO's initial 100% addition, reduced to 5% by the CIT(A), and finally upheld at 6% by the ITAT in earlier proceedings. The Tribunal found that this issue, arising from identical facts of estimated additions on account of alleged bogus purchases, had already been settled in the assessee's own case for earlier years by a co-ordinate bench of the ITAT, Surat. Furthermore, the Tribunal referred to other decisions of co-ordinate benches of ITAT, Surat, and decisions of the jurisdictional High Court, which supported the deletion of penalty on estimated additions. The Tribunal directed the AO to delete the impugned penalties. No issue was expressly left undecided.

The Tribunal set aside the impugned order of the Ld. CIT(A) and restored the matter to his file for fresh adjudication. The Ld. CIT(A) is directed to examine the relevant material concerning the service of the order and notice of demand to determine the issue of limitation in accordance with law. If the appeal is found to be within limitation, it shall be admitted. If found to be delayed, the Ld. CIT(A) shall consider the condonation of delay after affording the assessee a reasonable opportunity of being heard. Upon admission, the Ld. CIT(A) shall adjudicate the grounds relating to the validity of reassessment proceedings and the addition of Rs. 65,50,000/- under Section 68 on merits, after giving both sides a reasonable opportunity of being heard. The Ld. CIT(A) is to pass a reasoned order uninfluenced by the findings in the impugned order. The ITAT allowed the appeal for statistical purposes.

For ITA No. 868/SRT/2026, the Tribunal held that the rejection of the Section 12A application was primarily due to the assessee's non-compliance. However, noting that only one opportunity was granted, the Tribunal set aside the impugned order and restored the matter to the Ld. CIT(E) for fresh consideration, directing that reasonable and adequate opportunities of hearing be provided. The assessee was directed to cooperate and furnish documents without unnecessary adjournments. For ITA No. 230/SRT/2026, the Tribunal condoned the delay of 633 days, finding sufficient cause and adopting a justice-oriented approach. On merits, the Tribunal held that the mistake in selecting the incorrect sub-clause under Section 80G(5) was a technical error, not a grave one making the assessee ineligible. Following the precedent of ITAT Pune Bench in National Association for the Blind, the Tribunal set aside the impugned order and remanded the matter to the Ld. CIT(E) for de novo adjudication, allowing the assessee to rectify the clause if required and providing an opportunity of hearing. For ITA No. 231/SRT/2026, the assessee prayed for not pressing the appeal, and the revenue had no objection. Accordingly, the appeal was dismissed as not pressed. The Tribunal allowed ITA 230/SRT/2026 & 868/SRT/2026 for statistical purposes and dismissed ITA 231/SRT/2026.

The Tribunal held that the assessee's contention regarding the lack of opportunity of being heard by the CPC was not explicitly decided. Regarding the second issue, the Tribunal noted that while the assessee claimed to have filed Form 10-ID for AY 2023-24, records indicated it was filed on 28-09-2022 for AY 2022-23. For AY 2023-24, Form 3CA-3CD was filed, but Form 10-ID was not. The Tribunal referred to Section 115BAB, which requires compliance with conditions in sub-section 2. It also considered Section 115BAA, proviso to sub-section 5, which states that if an option under Section 115BAB is invalid due to violations, the assessee may exercise the option under Section 115BAA, and once exercised, it cannot be withdrawn. The Tribunal found the revenue's contention justifiable, noting that the Mumbai Tribunal decisions did not consider the Supreme Court's decision in Wipro Ltd. Therefore, the appeal of the assessee was dismissed.

The Tribunal dismissed the appeal of the Revenue. The Tribunal noted that the CIT(A) had taken into account the details furnished by the assessee, which were also available to the AO. The CIT(A) had made a categorical finding that the assessee had furnished confirmations and bank books of the relevant parties, establishing the identity of depositors and the genuineness of transactions by explaining their business purpose. The CIT(A) also considered the creditworthiness of the parties for whom such details were established. Therefore, the Tribunal found no reason to interfere with the findings of the CIT(A) and held that the deletion of the additions by the CIT(A) was justified. The appeal of the Revenue was dismissed.

The Tribunal noted that the retraction of Shri Deepak Jain before the Executive Magistrate was not considered by the AO or the CIT(A). The assessee had also provided bank statements, confirmations, and ITR acknowledgments of M/s. Abhinandan Diamond Pvt. Ltd., which the Revenue had not commented upon. Considering that a similar appeal for AY 2012-13 was restored to the CIT(A) by the Tribunal, the Tribunal decided to remand the matter back to the file of the CIT(A). The CIT(A) was directed to properly verify the details filed by the assessee and adjudicate the issues in accordance with the Income Tax Act, ensuring that the assessee is given an opportunity of hearing as per the principles of natural justice. The Tribunal expressly left undecided the merits of the additions made by the AO and confirmed by the CIT(A) pending this remand.

The Tribunal noted that the retraction of Shri Deepak Jain before the Executive Magistrate was not considered by the AO and CIT(A). The assessee had also provided bank statements, confirmations, and ITR acknowledgments of M/s. Abhinandan Diamonds Pvt. Ltd., which the Revenue had not commented upon. Citing the precedent of a similar appeal for AY 2012-13 (ITA No. 915/SRT/2024) being restored to the CIT(A) by the Tribunal, the Bench decided to remand the matter back to the file of the CIT(A). The CIT(A) is directed to properly verify the details filed by the assessee and adjudicate the issues in accordance with the Income Tax Act, ensuring that the assessee is given an opportunity of hearing as per the principles of natural justice. The issue regarding the opportunity of hearing was implicitly addressed by remanding the matter for proper adjudication with natural justice principles.

The Tribunal condoned the delay in filing the appeals, citing Section 253(5) of the Act and the Supreme Court's decision in Collector, Land Acquisition Vs Mst. Katiji and others, which emphasizes a justice-oriented approach. The Tribunal found that the assessee had a "sufficient cause" for the delay. Regarding the ex-parte orders, the Tribunal restored the matters to the file of the CIT(A) for fresh adjudication. The reasoning was based on the principle of natural justice and the fact that no prejudice would be caused to the revenue. The assessee was directed to ensure participation in hearings without seeking unnecessary adjournments, failing which the CIT(A) would be at liberty to proceed as per law. The appeals were allowed for statistical purposes.

The Tribunal allowed the additional ground of appeal, holding that the assessment order is without jurisdiction due to the absence of a notice under Section 143(2) after the assessee filed a revised return of income on November 29, 2018. The Tribunal reasoned that a revised return, when accepted and used by the AO for computing assessed income, substitutes the original return and requires a fresh notice under Section 143(2). Citing the decisions in L&T Mutual Fund Asset Management Ltd. vs. CIT and Yes & Yes Hitech Premier Homes vs. ITO, the Tribunal stated that the non-issuance of such a notice is an incurable defect and fatal to the assessment order. Consequently, the assessment itself was declared void ab initio. As the assessment is invalid, the original grounds of appeal concerning the additions made by the AO and confirmed by the CIT(A) were rendered academic and did not require adjudication.

The Tribunal partly allowed the appeal concerning the addition of Rs. 40,00,000 on account of unsecured loans. While acknowledging the assessee's submission that some lenders were related and accounted for a significant portion of the loan, the Tribunal noted the lack of details regarding repayment and the fact that creditors deposited cash before advancing loans. Considering the revenue's alternative plea and the surrounding circumstances, the Tribunal sustained 50% of the addition, i.e., Rs. 20,00,000, holding that the creditors had deposited cash in their bank accounts before advancing loans. For the addition of Rs. 14,04,322 on account of cash deposits, the Tribunal allowed the appeal. The Tribunal found that the assessee's cash book appeared to explain the source of cash and established a nexus between withdrawals and deposits. The Tribunal relied on the Gujarat High Court decision in Blessing Construction vs. ITO. The operative direction was to delete the addition of Rs. 14,04,322 and sustain Rs. 20,00,000 out of the Rs. 40,00,000 addition.

The Tribunal condoned the delay in filing the appeals, citing Section 253(5) of the Act and the Supreme Court's decision in Collector, Land Acquisition Vs Mst. Katiji and others, which emphasizes a justice-oriented approach. The Tribunal found that the assessee had a "sufficient cause" for the delay. Regarding the ex-parte orders, the Tribunal restored the matters to the file of the CIT(A) for fresh adjudication. The reasoning was based on the principle of natural justice and the fact that no prejudice would be caused to the revenue. The assessee was directed to ensure participation in hearings without seeking unnecessary adjournments, failing which the CIT(A) would be at liberty to proceed as per law. The appeals were allowed for statistical purposes.

The Tribunal held that the penalty imposed under Section 271(1)(c) of the Income-tax Act, 1961, is unsustainable in law. The reasoning was based on the established principle that penalty is not exigible when additions to income are made and sustained on an ad hoc or estimated basis. The Tribunal noted that the additions in the assessee's case had undergone a series of estimations at all levels, starting from the AO's initial 100% addition, reduced to 5% by the CIT(A), and finally upheld at 6% by the ITAT. The Tribunal found that this issue, arising from identical facts of estimated additions on account of alleged bogus purchases, had already been settled in the assessee's own case for earlier years by a co-ordinate bench of the ITAT, Surat. Furthermore, similar issues had been settled in favour of assessees by other co-ordinate benches of the ITAT, Surat. The Tribunal also referred to decisions of the jurisdictional High Court supporting the deletion of penalty on estimated additions. The Tribunal directed the AO to delete the impugned penalties. No issue was expressly left undecided.

The Tribunal condoned the delays in filing the appeals before the Ld. CIT(A) by applying the principle of "sufficient cause" and "substantial justice" over technical considerations, citing the Supreme Court's decision in Collector, Land Acquisition Vs Mst. Katiji and others. The Tribunal restored both the assessment and penalty matters to the file of the Ld. AO for adjudication afresh. The Ld. AO was directed to provide an opportunity of hearing to the assessee, consider the additional evidence filed before the ITAT, and any further evidence the assessee might submit. The assessee was cautioned to remain vigilant and ensure participation without seeking unnecessary adjournments. The Ld. AO was granted liberty to proceed in accordance with law if the assessee failed to comply. The appeals were allowed for statistical purposes.

The Tribunal noted that the AO relied on the statement of the assessee's husband and impounded papers (page 84 of Annexure BF-20) to add Rs. 12,25,000/-. However, the Tribunal observed that the assessee's husband had denied knowledge of the receipt of this cash in specific questions of his statement dated 17.03.2017. Furthermore, the assessee was not provided with the loose papers at the time of assessment proceedings. The assessee had provided details of the registered sale document executed on 06.10.2016, which was not verified in consonance with the alleged on-money receipt. Since the documents were not provided as per Ground No. 1.1, the matter requires proper verification. Therefore, the Tribunal remanded the matter back to the Assessing Officer for proper verification and adjudication, with a direction to provide the assessee an opportunity of hearing. Ground No. 1.1 was partly allowed for statistical purposes. As other grounds were corollary to Ground No. 1.1, they were not adjudicated at that juncture. The ratio decidendi is that additions based on alleged undisclosed cash receipts from property sale, without proper verification of the sale deed and without providing supporting documents to the assessee, are unsustainable and require remand for proper inquiry.

The Tribunal partly allowed Ground No. 1 concerning the addition of Rs. 40,00,000/- on account of unsecured loans. While acknowledging that the assessee had provided some documentation, the Tribunal noted that the creditors had deposited cash in their bank accounts immediately before advancing the loans. Considering the surrounding circumstances and the alternative plea of the Revenue, the Tribunal sustained 50% of the addition, i.e., Rs. 20,00,000/-, and deleted the remaining Rs. 20,00,000/-. The reasoning was that the balance was available with the creditors, but the direct nexus and creditworthiness were not fully established. For Ground No. 2, the Tribunal allowed the appeal concerning the addition of Rs. 14,04,322/- on account of cash deposits. The Tribunal found that the assessee's case contained a proper day-to-day running balance in the cash book, and the assessee had explained the source of cash generated and established a nexus between withdrawals and deposits. Therefore, the addition was not sustained. The decision of the Gujarat High Court in Blessing Construction vs. ITO was considered applicable.

The Tribunal held that the appeal of the Revenue is dismissed. The Tribunal noted that the CIT(A) had taken into account the details furnished by the assessee, which were also available to the AO. The CIT(A) made a categorical finding that the assessee had furnished confirmations and bank books of the relevant parties, establishing the identity of the depositors and the genuineness of the transactions for business purposes. The CIT(A) also considered the creditworthiness of the parties where established. Therefore, the Tribunal found no reason to interfere with the findings of the CIT(A) and upheld the deletion of the additions made by the AO. The ratio decidendi is that if the assessee provides sufficient evidence of identity, creditworthiness, and genuineness of transactions, and these were considered by the lower appellate authority, the Tribunal will not interfere with such findings.

The Tribunal held that the assessee filed Form 10-ID on September 28, 2022, for AY 2022-23. For AY 2023-24, the assessee filed its return of income on September 28, 2023, but Form 10-ID was not filed; instead, Form 3CA-3CD was filed. The Tribunal referred to Section 115BAB, which requires compliance with conditions in sub-section 2. It noted that Section 115BAA, sub-section 5 proviso, states that if an option under Section 115BAB is rendered invalid due to violations, the assessee may exercise the option under Section 115BAA, and once exercised, it cannot be withdrawn. Therefore, Sections 115BAA and 115BAB should be considered together. The Tribunal found that the decisions of the Mumbai Tribunal did not consider the Apex Court's decision in Wipro Ltd. Thus, the contention of the revenue was found to be justifiable. The appeal was dismissed.

The Tribunal condoned the delay in filing the appeals, citing Section 253(5) of the Act and the Supreme Court's decision in Collector, Land Acquisition Vs Mst. Katiji and others, which emphasizes a justice-oriented approach. The Tribunal found that the assessee had a "sufficient cause" for the delay. Regarding the ex-parte orders, the Tribunal restored the matters to the file of the CIT(A) for fresh adjudication. The reasoning was based on the principle of natural justice and the fact that no prejudice would be caused to the revenue. The assessee was directed to ensure participation in hearings without seeking unnecessary adjournments, failing which the CIT(A) would be at liberty to proceed as per law. The appeals were allowed for statistical purposes.

The Tribunal noted that the CIT(A) dismissed the appeal solely on the ground of delay, without examining the merits of the case. The delay was attributed to the negligence of the assessee's previous consultant, which should not be held against the assessee. The Tribunal observed that the assessee's claim for deductions under Section 80P(2)(a)(i) and 80P(2)(d) appeared to have not been verified by either the CIT(A) or the AO. Therefore, to ensure proper verification of the claim, the Tribunal decided to remand the matter back to the file of the AO. The AO was directed to properly verify the claim made by the assessee under Section 80P and adjudicate the issue accordingly. The assessee was also to be given an opportunity of hearing, adhering to the principles of natural justice. The specific amount of Rs. 98,09,175/- mentioned in ground 2 was not specifically addressed in terms of its allowability, as the matter was remanded.

The Tribunal noted that the Assessing Officer (AO) relied on the statement of the assessee's husband and impounded papers (page No.84 of Annexure BF-20) to add Rs. 12,25,000/- as cash received on the sale of the flat. However, the Tribunal observed that the assessee's husband had denied knowledge of receiving this cash in his statement (Answers to Question No.19 & 20 dated 17.03.2017). Furthermore, the assessee was not provided with the loose papers during the assessment proceedings, and the registered sale document executed on 06.10.2016 was not verified in consonance with the alleged on-money receipt. Given these discrepancies and the failure to provide documents as per Ground No.1.1, the Tribunal found that the matter requires proper verification and adjudication. Therefore, the Tribunal remanded the case back to the Assessing Officer for proper verification and adjudication, with a direction to provide the assessee an opportunity of hearing, following the principles of natural justice. Ground No.1.1 was partly allowed for statistical purposes. The other grounds were not adjudicated as they were corollary to Ground No.1.1.

For ITA 868/SRT/2026, the Tribunal held that the rejection of the Section 12A application was primarily due to the assessee's non-compliance. However, the Ld. CIT(E) had afforded only one opportunity. Considering the significant consequences of Section 12A registration and in the interest of justice, the Tribunal set aside the impugned order and restored the matter to the Ld. CIT(E) for fresh consideration, directing the Ld. CIT(E) to provide reasonable opportunities and the assessee to cooperate. The appeal was allowed for statistical purposes. For ITA 230/SRT/2026, the Tribunal condoned the delay of 633 days, citing a justice-oriented approach as emphasized by the Supreme Court. On merits, the Tribunal noted the assessee's submission that a technical mistake was made in selecting the incorrect clause of the proviso to Section 80G(5). Following the decisions of the ITAT Pune Bench in National Association for the Blind (supra) and other similar cases, the Tribunal set aside the Ld. CIT(E)'s order and remanded the matter for de novo adjudication, allowing the assessee to rectify the applicable clause and requiring the Ld. CIT(E) to provide an opportunity of hearing. The appeal was allowed for statistical purposes. For ITA 231/SRT/2026, the assessee's counsel prayed not to press the appeal. The Ld. DR had no objection. Accordingly, this appeal was dismissed as not-pressed.

For ITA No. 868/SRT/2026, the Tribunal held that the rejection of the Section 12A application was primarily due to the assessee's non-compliance. However, noting that only one opportunity was granted, the Tribunal set aside the impugned order and restored the matter to the Ld. CIT(E) for fresh consideration, directing that reasonable and adequate opportunities of hearing be provided. The assessee was directed to cooperate and furnish documents without unnecessary adjournments. For ITA No. 230/SRT/2026, the Tribunal condoned the delay of 633 days, finding sufficient cause and adopting a justice-oriented approach. On merits, the Tribunal held that the mistake in selecting the incorrect sub-clause under Section 80G(5) was a technical error, not a grave one making the assessee ineligible. Following the precedent of ITAT Pune Bench in National Association for the Blind, the Tribunal set aside the impugned order and remanded the matter to the Ld. CIT(E) for de novo adjudication, allowing the assessee to rectify the clause if required and providing an opportunity of hearing. For ITA No. 231/SRT/2026, the assessee prayed for not pressing the appeal, and the revenue had no objection. Accordingly, the appeal was dismissed as not pressed. The Tribunal allowed ITA 230/SRT/2026 & 868/SRT/2026 for statistical purposes and dismissed ITA 231/SRT/2026.

The Tribunal held that the penalty imposed under Section 271(1)(c) of the Income-tax Act, 1961, is unsustainable in law. The reasoning was based on the established principle that penalty is not exigible when additions to income are made and sustained on an ad hoc or estimated basis. The Tribunal noted that the additions in the assessee's case had undergone a series of estimations at all levels, starting from the AO's initial 100% addition, reduced to 5% by the CIT(A), and finally upheld at 6% by the ITAT. The Tribunal found that this issue, arising from identical facts of estimated additions on account of alleged bogus purchases, had already been settled in the assessee's own case for earlier years by a co-ordinate bench of the ITAT, Surat. Furthermore, similar issues had been settled in favour of assessees by other co-ordinate benches of the ITAT, Surat. The Tribunal also referred to decisions of the jurisdictional High Court supporting the deletion of penalty on estimated additions. The Tribunal directed the AO to delete the impugned penalties. No issue was expressly left undecided.

The Tribunal noted that the AO had passed the assessment order and made the addition without considering the report of the DVO. The assessee's counsel drew the Tribunal's attention to the DVO's report dated 27.10.2022, which was placed in the paper book. The assessee's counsel prayed for a remand of the matter to the AO for a fresh assessment after considering the DVO report and the assessee's submissions. The Revenue's representative agreed to this course of action. Consequently, the Tribunal remanded the matter back to the file of the AO for fresh assessment. The AO was directed to give the assessee a full opportunity to present its submissions and to consider all such submissions without being influenced by the previous order. The appeal was allowed for statistical purposes.

For ITA 868/SRT/2026, the Tribunal held that the rejection of the Section 12A application was primarily due to the assessee's non-compliance. However, the Ld. CIT(E) had afforded only one opportunity. Considering the significant consequences of Section 12A registration and in the interest of justice, the Tribunal set aside the impugned order and restored the matter to the Ld. CIT(E) for fresh consideration, directing the Ld. CIT(E) to provide reasonable opportunities and the assessee to cooperate. The appeal was allowed for statistical purposes. For ITA 230/SRT/2026, the Tribunal condoned the delay of 633 days, citing a justice-oriented approach as emphasized by the Supreme Court. On merits, the Tribunal noted the assessee's submission that a technical mistake was made in selecting the incorrect clause of the proviso to Section 80G(5). Following the decisions of the ITAT Pune Bench in National Association for the Blind (supra) and other similar cases, the Tribunal set aside the Ld. CIT(E)'s order and remanded the matter for de novo adjudication, allowing the assessee to rectify the applicable clause and requiring the Ld. CIT(E) to provide an opportunity of hearing. The appeal was allowed for statistical purposes. For ITA 231/SRT/2026, the assessee's counsel prayed not to press the appeal. The Ld. DR had no objection. Accordingly, this appeal was dismissed as not-pressed.

The Tribunal condoned the delays in filing the appeals before the Ld. CIT(A) by applying the principle of "sufficient cause" and "substantial justice" as laid down by the Hon'ble Supreme Court in Collector, Land Acquisition Vs Mst. Katiji and others. The Tribunal noted that the revenue did not controvert the assessee's explanation regarding partner disputes and the Ld. DR did not object to the matter being restored. Consequently, the appeals were restored to the file of the Ld. AO for adjudication afresh. The Ld. AO was directed to provide an opportunity of hearing to the assessee, consider the additional evidence filed before the Tribunal, and any further evidence the assessee might submit. The assessee was cautioned to remain vigilant and ensure participation without seeking unnecessary adjournments. The Ld. AO was granted liberty to proceed as per law if the assessee failed to comply. The appeals were allowed for statistical purposes.

The Tribunal condoned the delays in filing the appeals, citing the Supreme Court's decision in Collector, Land Acquisition Vs Mst. Katiji and others, emphasizing that technical considerations should not prevail over substantial justice. For the quantum appeal (ITA 400/SRT/2026), the Tribunal restored the matter to the file of the Assessing Officer (AO) for fresh adjudication. This decision was based on the principle of natural justice and the fact that no prejudice would be caused to the revenue. The restoration was made subject to the assessee paying a cost of Rs. 5,000 to the Income-tax Department and ensuring vigilant participation in future hearings without seeking unnecessary adjournments. The AO was directed to provide an opportunity of hearing and pass an appropriate order uninfluenced by the earlier order. The quantum appeal was allowed for statistical purposes, subject to the cost payment. For the penalty appeal (ITA 462/SRT/2026), the Tribunal upheld the penalty of Rs. 30,000 imposed under section 271(1)(b) for non-compliance with notices. The assessee's representative could not rebut the revenue's submissions or provide reasons to interfere with the lower authorities' orders. Consequently, the penalty appeal was dismissed. The Tribunal expressly left undecided any issue related to the correct computation of capital gains under section 48 or the benefit under section 50C(2), as these were to be adjudicated by the AO.

The Tribunal noted that the Assessing Officer (AO) passed the assessment order and made the impugned addition without considering the report of the Departmental Valuation Officer (DVO). The assessee's counsel drew the Tribunal's attention to the DVO's report dated 27.10.2022. The assessee's counsel prayed for the matter to be remanded to the AO for a fresh assessment after considering the DVO report and the assessee's objections. The Revenue's representative agreed to this course of action. Consequently, the Tribunal remanded the matter back to the AO for a fresh assessment. It was clarified that the AO shall provide the assessee with a full opportunity to present its submissions and consider all objections without being influenced by the previous order. The appeal was allowed for statistical purposes.

The ITAT set aside the impugned order of the Ld. CIT(A) and restored the matter to his file for fresh adjudication. The Ld. CIT(A) is directed to examine the relevant material concerning the service of the assessment order and notice of demand to determine the issue of limitation in accordance with law. If the appeal is found to be within the limitation period, it shall be admitted. If it is found to be delayed, the Ld. CIT(A) shall consider the condonation of delay after providing the assessee a reasonable opportunity of being heard. Upon admission, the Ld. CIT(A) shall adjudicate the grounds relating to the validity of reassessment proceedings and the addition of Rs. 65,50,000/- under Section 68 on merits, after giving both parties a reasonable opportunity of being heard. The Ld. CIT(A) is to pass a reasoned order, uninfluenced by the findings in the impugned order. The Tribunal noted the assessee's submission that the assessment order was served on 26.06.2024, making the appeal filed on 25.07.2024 within the statutory period, and the Ld. CIT(A)'s dismissal for delay. The Tribunal also noted the assessee's challenge to the reassessment proceedings and the addition, and the revenue's request for remand due to lack of scrutiny.

The Tribunal condoned the delays in filing the appeals before the Ld. CIT(A) by applying the principle of "sufficient cause" and "substantial justice" over technical considerations, citing the Supreme Court's decision in Collector, Land Acquisition Vs Mst. Katiji and others. The Tribunal restored both the assessment and penalty matters to the file of the Ld. AO for adjudication afresh. The Ld. AO was directed to provide an opportunity of hearing to the assessee, consider the additional evidence filed before the ITAT, and any further evidence the assessee might submit. The assessee was cautioned to remain vigilant and ensure participation without seeking unnecessary adjournments. The Ld. AO was granted liberty to proceed in accordance with law if the assessee failed to comply. The appeals were allowed for statistical purposes.

The Tribunal held that the penalty imposed under Section 271(1)(c) is unsustainable in law. The reasoning was based on the established principle that penalty is not exigible when additions to income are made or sustained on an ad hoc or estimated basis. The Tribunal noted that the additions in this case had undergone a series of estimations at all appellate levels, starting from the AO's initial 100% addition, reduced to 5% by the CIT(A), and finally upheld at 6% by the ITAT in earlier proceedings. The Tribunal found that this issue, arising from identical facts of estimated additions on account of alleged bogus purchases, had already been settled in the assessee's own case for earlier years by a co-ordinate bench of the ITAT, Surat. Furthermore, the Tribunal referred to other decisions of co-ordinate benches of ITAT, Surat, and decisions of the jurisdictional High Court, which supported the deletion of penalty on estimated additions. The Tribunal directed the AO to delete the impugned penalties. No issue was expressly left undecided.

For ITA 868/SRT/2026, the Tribunal held that the rejection of the Section 12A application was primarily due to the assessee's non-compliance. However, the Ld. CIT(E) had afforded only one opportunity. Considering the significant consequences of Section 12A registration and in the interest of justice, the Tribunal set aside the impugned order and restored the matter to the Ld. CIT(E) for fresh consideration, directing the Ld. CIT(E) to provide reasonable opportunities and the assessee to cooperate. The appeal was allowed for statistical purposes. For ITA 230/SRT/2026, the Tribunal condoned the delay of 633 days, citing a justice-oriented approach as emphasized by the Supreme Court. On merits, the Tribunal noted the assessee's submission that a technical mistake was made in selecting the incorrect clause of the proviso to Section 80G(5). Following the decisions of the ITAT Pune Bench in National Association for the Blind (supra) and other similar cases, the Tribunal set aside the Ld. CIT(E)'s order and remanded the matter for de novo adjudication, allowing the assessee to rectify the applicable clause and requiring the Ld. CIT(E) to provide an opportunity of hearing. The appeal was allowed for statistical purposes. For ITA 231/SRT/2026, the assessee's counsel prayed not to press the appeal. The Ld. DR had no objection. Accordingly, this appeal was dismissed as not-pressed.

The Tribunal condoned the delay of 399 days in filing the appeal, finding that the assessee had demonstrated a "sufficient cause" for the delay. The Tribunal relied on the assessee's explanation regarding their lack of technical expertise and reliance on tax consultants, coupled with the fact that they only became aware of the proceedings upon physical notice. The Tribunal invoked Section 253(5) of the Act and referred to the Supreme Court's decision in Collector, Land Acquisition Vs Mst. Katiji and others, emphasizing a justice-oriented approach over technical considerations. The Tribunal also restored the matter to the file of the Assessing Officer for fresh adjudication, citing the principle of natural justice and noting that no prejudice would be caused to the Revenue. This restoration was made subject to the assessee paying a cost of Rs. 5,000/- to the Income-Tax Department and ensuring strict compliance in future proceedings, with the AO being at liberty to proceed according to law if the assessee fails to participate without unnecessary adjournments. The assessee was directed to make a proper and effective representation before the AO.

The Tribunal condoned the delays in filing the appeals, citing the Supreme Court's decision in Collector, Land Acquisition Vs Mst. Katiji and others, emphasizing that technical considerations should not prevail over substantial justice. For the quantum appeal (ITA 400/SRT/2026), the Tribunal restored the matter to the file of the Assessing Officer (AO) for fresh adjudication. This decision was based on the principle of natural justice and the fact that no prejudice would be caused to the revenue. The restoration was made subject to the assessee paying a cost of Rs. 5,000 to the Income-tax Department and ensuring vigilant participation in future hearings without seeking unnecessary adjournments. The AO was directed to provide an opportunity of hearing and pass an appropriate order uninfluenced by the earlier order. The quantum appeal was allowed for statistical purposes, subject to the cost payment. For the penalty appeal (ITA 462/SRT/2026), the Tribunal upheld the penalty of Rs. 30,000 imposed under section 271(1)(b) for non-compliance with notices. The assessee's representative could not rebut the revenue's submissions or provide reasons to interfere with the lower authorities' orders. Consequently, the penalty appeal was dismissed. The Tribunal expressly left undecided any issue related to the correct computation of capital gains under section 48 or the benefit under section 50C(2), as these were to be adjudicated by the AO.

The Tribunal condoned the delay in filing the appeals, acknowledging the assessee's explanation and the principle of substantial justice over technical considerations, as laid down by the Hon'ble Supreme Court in Collector, Land Acquisition Vs Mst. Katiji and others. The Tribunal also restored the matters to the file of the Ld. CIT(A) for fresh adjudication. The reasoning was that no prejudice would be caused to the Revenue by restoring the appeals, and it was in line with the principles of natural justice. The Ld. CIT(A) was directed to provide the assessee with an opportunity of hearing and pass appropriate orders, uninfluenced by the earlier ex-parte orders. The assessee was cautioned to remain vigilant and ensure participation in future hearings without seeking unnecessary adjournments, failing which the Ld. CIT(A) would be at liberty to proceed according to law. The appeals were allowed for statistical purposes.

The Tribunal condoned the delays in filing the appeals before the Ld. CIT(A) by applying the principle of "sufficient cause" and "substantial justice" as laid down by the Hon'ble Supreme Court in Collector, Land Acquisition Vs Mst. Katiji and others. The Tribunal noted that the revenue did not controvert the assessee's explanation regarding partner disputes and the Ld. DR did not object to the matter being restored. Consequently, the appeals were restored to the file of the Ld. AO for adjudication afresh. The Ld. AO was directed to provide an opportunity of hearing to the assessee, consider the additional evidence filed before the Tribunal, and any further evidence the assessee might submit. The assessee was cautioned to remain vigilant and ensure participation without seeking unnecessary adjournments. The Ld. AO was granted liberty to proceed as per law if the assessee failed to comply. The appeals were allowed for statistical purposes.

The Tribunal condoned the delay in filing the appeals, acknowledging the assessee's explanation and the principle of substantial justice over technical considerations, as laid down by the Hon'ble Supreme Court in Collector, Land Acquisition Vs Mst. Katiji and others. The Tribunal also restored the matters to the file of the Ld. CIT(A) for fresh adjudication. The reasoning was that no prejudice would be caused to the Revenue by restoring the appeals, and it was in line with the principles of natural justice. The Ld. CIT(A) was directed to provide the assessee with an opportunity of hearing and pass appropriate orders, uninfluenced by the earlier ex-parte orders. The assessee was cautioned to remain vigilant and ensure participation in future hearings without seeking unnecessary adjournments, failing which the Ld. CIT(A) would be at liberty to proceed according to law. The appeals were allowed for statistical purposes.

The Tribunal condoned the delay in filing the appeals, acknowledging the assessee's explanation and the principle of substantial justice over technical considerations, as laid down by the Hon'ble Supreme Court in Collector, Land Acquisition Vs Mst. Katiji and others. The Tribunal also restored the matters to the file of the Ld. CIT(A) for fresh adjudication. The reasoning was that no prejudice would be caused to the Revenue by restoring the appeals, and it was in line with the principles of natural justice. The Ld. CIT(A) was directed to provide the assessee with an opportunity of hearing and pass appropriate orders, uninfluenced by the earlier ex-parte orders. The assessee was cautioned to remain vigilant and ensure participation in future hearings without seeking unnecessary adjournments, failing which the Ld. CIT(A) would be at liberty to proceed according to law. The appeals were allowed for statistical purposes.

The Tribunal allowed the additional ground of appeal. It held that a fresh notice under Section 143(2) is mandatory when a revised return is filed and accepted by the Assessing Officer, as the notice is return-specific, not assessment year-specific. The Tribunal relied on the proviso to Section 143(2), which states that no notice shall be served after six months from the end of the financial year in which the return is furnished. In this case, the revised return was filed on November 29, 2018, and the assessment order was passed on December 5, 2018, leaving time for issuing a fresh notice. The Tribunal cited decisions in L&T Mutual Fund Asset Management Ltd. vs. CIT and Yes & Yes Hitech Premier Homes vs. ITO, holding that the non-issuance of a notice under Section 143(2) after a valid revised return is an incurable defect and fatal to the assessment order. Consequently, the assessment order was deemed to be without jurisdiction and void ab initio. As the assessment itself was invalid, the original grounds of appeal became academic and did not require adjudication.

Regarding the addition of Rs. 1,59,00,000 under Section 69A, the Tribunal found merit in the assessee's contention. The assessee had provided documentary evidence (ledger, sale bill, bank statement) to demonstrate that the amount received from M/s Hollistar & Co. was a business advance that was settled partly by supply of goods and partly by refund. Therefore, it could not be treated as unexplained money. The Tribunal directed the AO to delete this addition. This allowed Ground No. 2 and Additional Ground No. 1. Concerning the addition of Rs. 1,99,13,512 under Section 44AD, the Tribunal noted that the AO's estimation was based on the alleged inadequacy of the audit report. Since the assessee presented evidence of timely e-filing of the audit report and its subsequent submission to the AO, the Tribunal considered it appropriate to restore the issue to the AO for fresh adjudication. The AO was directed to verify the audit report and other documents and decide the issue afresh. This allowed Ground No. 3 and Additional Ground No. 2 for statistical purposes. Regarding the penalty under Section 271B, the Tribunal found that the AO's basis for imposing the penalty (improper audit report) was not sustainable. Evidence showed the assessee had obtained and furnished the audit report within statutory requirements. The Tribunal directed the AO to delete the penalty. This allowed the penalty appeal. The Tribunal also directed the assessee to furnish a legible copy of the audit report if required by the AO for quantum proceedings.

The Income Tax Appellate Tribunal (ITAT) restored the matter to the file of the Assessing Officer (AO) for fresh adjudication. The Tribunal considered the principle of natural justice and noted that no prejudice would be caused to the revenue by restoring the case. The assessee's prayer for remand was accepted, with the understanding that the assessee now possesses all relevant details and documents and would make an effective representation. The ITAT directed the AO to provide the assessee with an opportunity of hearing and pass an appropriate order, uninfluenced by the earlier order. The assessee was also directed to be vigilant and ensure participation in hearings without seeking unnecessary adjournments, failing which the AO would be at liberty to proceed in accordance with law. The appeal was allowed for statistical purposes.

On the first issue concerning the addition of Rs. 1,59,00,000/- under Section 69A, the Tribunal found merit in the assessee's contention. The Tribunal noted that the assessee had explained the amount as a business advance from M/s Hollistar & Co. which was settled partly by supply of goods and partly by repayment. The documentary evidence, including ledger account, sale bill, and bank statement, supported this explanation. Therefore, the Tribunal held that the amount could not be treated as unexplained money under Section 69A and directed the AO to delete the addition. This allowed Ground No. 2 and Additional Ground No. 1. On the second issue regarding the addition of Rs. 1,99,13,512/- under Section 44AD, the Tribunal, considering the revenue's suggestion for remand and the assessee's submission about the timely e-filing of the audit report, found it appropriate to restore the issue to the AO for fresh adjudication. The AO was directed to verify the audit report and other documents and decide the issue afresh after providing the assessee an opportunity of being heard. This allowed Ground No. 3 and Additional Ground No. 2 for statistical purposes. On the third issue concerning the penalty under Section 271B, the Tribunal held that the levy of penalty must be examined against the statutory default under Section 44AB. Since the evidence showed that the assessee had obtained and furnished the audit report within statutory requirements, the basis for the penalty was not sustained. The Tribunal directed the AO to delete the penalty of Rs. 1,50,000/-. The assessee was directed to furnish a legible copy of the audit report if required by the AO for completion of quantum proceedings.

The Tribunal held that the notice under Section 148 of the Income Tax Act, 1961, issued on 31.03.2021, was invalid because it was served on the assessee via email on 01.04.2021. This date of service falls after the expiry of the limitation period under the old provisions. Furthermore, even if considered under the amended provisions effective from 01.04.2021, the notice was required to be treated as a notice under Section 148A(b), followed by an order under Section 148A(d), which did not happen. The Tribunal relied on the Gujarat High Court's decision in Saumil Abhinash Baheti, which held that a notice under Section 148 served via email on 01.04.2021 is invalid. Consequently, the assessment order made in pursuance of this invalid notice was set aside. The appeal of the assessee was allowed.

The Tribunal held that the notice under Section 148 of the Act, issued on 31.03.2021, was served on the assessee via email on 01.04.2021. This service date falls after the expiry of the limitation period under the old provisions. Furthermore, even under the amended provisions effective from 01.04.2021, the notice was required to be treated as a notice under Section 148A(b) and an order under Section 148A(d) should have been passed, which did not happen. The Tribunal relied on the Gujarat High Court's decision in Saumil Abhinash Baheti, which held that a notice under Section 148 served via email on 01.04.2021 is invalid. Consequently, the assessment order made in pursuance of this invalid notice was quashed and set aside. The issue of additions under Sections 69A and 69C was not decided on merits as the assessment itself was found to be invalid.

Regarding the addition of Rs. 1,59,00,000 under Section 69A, the Tribunal found merit in the assessee's contention. The assessee had provided documentary evidence (ledger, sale bill, bank statement) to demonstrate that the amount received from M/s Hollistar & Co. was a business advance that was settled partly by supply of goods and partly by refund. Therefore, it could not be treated as unexplained money. The Tribunal directed the AO to delete this addition. This allowed Ground No. 2 and Additional Ground No. 1. Concerning the addition of Rs. 1,99,13,512 under Section 44AD, the Tribunal noted that the AO's estimation was based on the alleged inadequacy of the audit report. Since the assessee presented evidence of timely e-filing of the audit report and its subsequent submission to the AO, the Tribunal considered it appropriate to restore the issue to the AO for fresh adjudication. The AO was directed to verify the audit report and other documents and decide the issue afresh. This allowed Ground No. 3 and Additional Ground No. 2 for statistical purposes. Regarding the penalty under Section 271B, the Tribunal found that the AO's basis for imposing the penalty (improper audit report) was not sustainable. Evidence showed the assessee had obtained and furnished the audit report within statutory requirements. The Tribunal directed the AO to delete the penalty. This allowed the penalty appeal. The Tribunal also directed the assessee to furnish a legible copy of the audit report if required by the AO for quantum proceedings.

The Tribunal held that the validity of Section 147 in respect of the notice under Section 148 was justifiable, dismissing Ground No. 1. The reasoning was that the AO had received information, provided details of alleged bogus purchases and sales in the reasons recorded, gave the assessee an opportunity during assessment proceedings, and the additions were based on these reasons. Regarding Ground No. 2, concerning the merits of the additions for sales and purchases, the Tribunal found that both the AO and CIT(A) had not properly verified the details filed by the assessee. Therefore, the matter was remanded back to the file of the AO for proper verification of details and adjudication on merits as per the Income Tax Act. The assessee was to be given an opportunity of hearing following the principles of natural justice. The Tribunal noted that Ground No. 2 was partly allowed for statistical purposes.

The Tribunal held that Form 26AS clearly reflected the TDS credit corresponding to the income, and the assessee had validly claimed it to that extent. The Tribunal noted that in the case of a co-owner of the same property, the TDS credit was granted. It found that both the AO and the CIT(A) ignored these crucial facts, including the statements in Form 26AS and the favorable treatment of the assessee's co-owners. Therefore, the Tribunal directed the AO/CPC to grant the TDS credit as it relates to the corresponding income. The principle established is that TDS credit reflected in Form 26AS and allowed to co-owners for the same transaction and assessment year should not be arbitrarily denied to the assessee.

The Tribunal held that the validity of Section 147 and the notice under Section 148 were justifiable, dismissing Ground No. 1. The AO had received information, provided details of alleged bogus purchases and sales, and given the assessee an opportunity to be heard during assessment proceedings. The addition was based on the reasons recorded. However, regarding Ground No. 2, concerning the merits of the additions for bogus sales and purchases, the Tribunal found that both the AO and CIT(A) had not properly verified the details filed by the assessee. Therefore, the matter was remanded back to the file of the AO for proper verification of the details and adjudication of the issues on merit as per the Income Tax Act. The assessee was to be given an opportunity of hearing following the principles of natural justice. Ground No. 2 was partly allowed for statistical purposes.

The Tribunal held that the assessee is eligible for deduction under Section 80IBA of the Income Tax Act, 1961, provided all conditions are met. The Tribunal noted that Form 29C, filed on 19.10.2020, specifically mentioned Section 80IBA deduction. While there was a mistake in the first page of Form 10CCB, the Tribunal considered it a typographical error and not a fatal flaw that should disentitle the assessee to the rightful deduction. The fact that the deduction under Section 80IBA was allowed for a subsequent assessment year (AY 2022-23) was also considered. The Tribunal found no dispute raised by the Revenue regarding the assessee's ineligibility for Section 80IBA deduction in principle for the current assessment year. Therefore, the matter was remanded back to the Assessing Officer for a proper verification of whether the assessee fulfilled all the conditions for claiming the deduction under Section 80IBA. The assessee was to be given an opportunity of hearing.

The Tribunal held that Form 26AS categorically reflected the TDS credit corresponding to the income, and this credit had been validly claimed by the assessee. The Tribunal noted that in the case of a co-owner of the same property, the TDS credit was granted for the same assessment year. It found that both the AO and the CIT(A) had ignored these crucial facts, including the statements in Form 26AS and the favorable treatment of the assessee's co-owners. Therefore, the Tribunal directed the AO/CPC to grant the TDS credit relating to the corresponding income. The Tribunal did not expressly leave any issue undecided.