ITAT Visakhapatnam Judgments — January 2025

The Tribunal dismissed the assessee's ground concerning the limitation period. However, it allowed the appeal on merits, finding that the assessee had a reasonable and sufficient cause under Section 273B due to the complete disclosure, bank deposit, and absence of intent to generate black money. Furthermore, the Tribunal noted that the Assessing Officer failed to record satisfaction for initiating penalty proceedings in the assessment order, which is a jurisdictional defect.

The Tribunal held that filing of Form-67 is a procedural aspect and can be considered directory in nature, not mandatory, especially when filed before the assessment order. The Tribunal relied on previous decisions and High Court judgments that supported this view.

The Tribunal, following its earlier decision in Mohammed Vaziruddin and judgments from the Karnataka and Kerala High Courts, held that Section 234E could not be enforced for periods prior to 01/06/2015. This is because the enabling provision for computation of fee while processing statements was inserted in Section 200A only with effect from 01/06/2015, making the levy of late filing fee for defaults before this date unsustainable in law. The Ld. AO was directed to delete the levied fee.

The Tribunal held that the enabling provision for computing and levying late filing fees under Section 234E via Section 200A was inserted with effect from 01/06/2015. Citing various High Court and Tribunal judgments, it ruled that Section 234E cannot be enforced for periods prior to 01/06/2015, irrespective of when the returns were filed or processed. Since the default occurred for a period prior to 01/06/2015, the levy of the late filing fee was deemed unsustainable.

The Tribunal held that the enabling provision for computation of fee under Section 200A was inserted with effect from 01/06/2015 by the Finance Act, 2015. Therefore, the charging Section 234E cannot be enforced for periods prior to 01/06/2015, irrespective of when the returns were filed or processed. Respectfully following various High Court judgments and its own prior decision, the Tribunal directed the Ld. AO to delete the late filing fee levied under Section 234E.

The Tribunal dismissed the assessee's ground concerning the limitation period. However, it allowed the appeal on merits, finding that the assessee had a reasonable and sufficient cause under Section 273B due to the complete disclosure, bank deposit, and absence of intent to generate black money. Furthermore, the Tribunal noted that the Assessing Officer failed to record satisfaction for initiating penalty proceedings in the assessment order, which is a jurisdictional defect.

The Tribunal held that the Pr. CIT exceeded its jurisdiction by giving specific directions to the Assessing Officer to complete the assessment in a particular manner. Relying on a Madras High Court judgment, the Tribunal set aside the Pr. CIT's order, thereby restoring the original order passed by the Assessing Officer.

The Tribunal confirmed the CIT(A)'s order, stating that the assessee's failure to disallow proportionate interest on funds personally utilized by the Managing Partner constituted concealment of income by furnishing inaccurate particulars, thereby justifying the penalty under Section 271(1)(c). The Supreme Court decision in CIT v. Reliance Petroproducts (P.) Limited was distinguished as being related to Section 14A.

The Tribunal confirmed the addition made by the AO under Section 69A, upholding the CIT(A)'s order. It ruled that the assessee failed to discharge the burden of proving the source and nature of the cash deposits, as no cash book or comparative statements for cash sales and deposits from prior years were provided. Consequently, the grounds of appeal raised by the assessee were dismissed.

The Tribunal confirmed the CIT(A)'s order, stating that the assessee's failure to disallow proportionate interest on funds personally utilized by the Managing Partner constituted concealment of income by furnishing inaccurate particulars, thereby justifying the penalty under Section 271(1)(c). The Supreme Court decision in CIT v. Reliance Petroproducts (P.) Limited was distinguished as being related to Section 14A.

Regarding AY 2018-19, the Tribunal dismissed the assessee's grounds challenging the Section 148A(b) notice and upheld the disallowance of Section 80P deduction due to the non-e-verification of the return, deeming it invalid. For AY 2020-21, the Tribunal condoned the delay in filing the appeal and allowed the assessee's appeal, holding that interest income earned by a cooperative society from deposits with a cooperative bank is eligible for deduction under Section 80P(2)(d) of the Act.

The Tribunal condoned the 157-day delay in filing the appeal before it due to reasonable cause. It held that since the Chief Commissioner of Income Tax (CCIT) had already condoned the delay in filing the original return of income for AY 2018-19, the assessee is entitled to claim the deduction under Section 80P of the Act. The AO/CPC was directed to allow the deduction.

The tribunal acknowledged the fact of cash withdrawals from the assessee's own bank account but found insufficient documentary evidence to substantiate the reasons for holding such a large amount for over eight months. Consequently, the tribunal allowed the addition to be deleted for the first deposit of Rs. 5,00,000 but confirmed the addition of the remaining Rs. 5,00,000.

For AY 2018-19, the Tribunal dismissed legal grounds against the Section 148A(b) notice and upheld the disallowance of Section 80P deduction due to an invalid (unverified) return. For AY 2020-21, after condoning a delay, the Tribunal ruled that interest income from cooperative bank investments is eligible for Section 80P(2)(d) deduction, thereby allowing the assessee's claim.

The Income Tax Appellate Tribunal (ITAT) remanded the case back to the Assessing Officer for fresh adjudication. The ITAT noted that the CIT(A) erred by deciding the appeal without a remand report from the AO, thereby failing to conduct a proper inquiry as mandated by Rule 46A and Sections 250(4) to (6). The CIT(A)'s order was deemed cryptic and lacking independent findings. The AO is directed to examine the additional evidence and pass a reasoned order on merits, giving the assessee an opportunity of being heard. Consequently, the assessee's cross-objections became infructuous.

The Tribunal acknowledged conflicting explanations but found the assessee's claim of accumulated savings and family financial support for ₹15,00,000/- of the cash deposits to be plausible based on circumstantial evidence. Consequently, relief was granted for ₹15,00,000/-, while the remaining ₹2,50,000/- of the addition under Section 69A was confirmed.

The Tribunal admitted the additional judicial documents, subject to a payment, noting that they were crucial to the case and their admission would not prejudice the Revenue. Consequently, the matter was remanded back to the Assessing Officer with directions to consider these documents and pass a fresh assessment order after providing the assessee due opportunity of hearing.

The Tribunal dismissed the appeal as withdrawn, granting the assessee liberty to file a Miscellaneous Application to reinstate the appeal if their case is not accepted under the Vivad Se Vishwas Scheme by the Revenue. Such an application must be filed within the time limit prescribed by the Act.

The Tribunal noted conflicting observations by the Ld. CIT(A) and AO regarding the submission of bank statements. To ensure natural justice and a thorough re-examination, the Tribunal decided to remit the matter back to the Assessing Officer for a fresh adjudication, directing the AO to verify the source of cash deposits and the assessee to cooperate.

The Tribunal noted the assessee's consistent failure to produce the cash book before the Assessing Officer and the First Appellate Authority. However, considering the plea for natural justice, the Tribunal decided to remit the case back to the Assessing Officer.

The Tribunal observed that the CIT(A)'s order lacked independent findings of fact and did not adequately consider the AO's failure to submit a remand report or conduct necessary inquiries. Consequently, the ITAT remanded the matter back to the AO to properly examine the additional evidence, conduct thorough inquiries, and decide the case on merits after affording the assessee an opportunity of being heard. The revenue's appeals were allowed for statistical purposes, and the assessee's cross-objections were disposed of as infructuous.

The Ld. CIT(A) had dismissed the assessee's appeal for non-prosecution due to the assessee's repeated failure to appear or provide documents. The Tribunal, acknowledging the assessee's lapses but considering the substantial addition and principles of natural justice, remitted the matter back to the Ld. CIT(A) for fresh consideration on merits, granting the assessee one more opportunity, conditional on their cooperation.

The Tribunal noted that the CIT(A) had provided multiple opportunities to the AO to submit a remand report, which the AO failed to do. The Tribunal observed that the CIT(A) allowed the appeal based on the material available, as the AO did not provide a remand report and the additional evidence was crucial. However, the Tribunal also found that the CIT(A)'s order was cryptic and lacked independent findings.

The Tribunal found that the Ld. CIT(E)'s rejection order lacked a proper discussion on why the trust's objectives were deemed non-charitable or the utility of funds. Consequently, the Tribunal set aside the rejection order and remitted the matter back to the Ld. CIT(E) for a fresh examination and to pass a speaking order.

The Tribunal dismissed the appeal as withdrawn, granting the assessee the liberty to file a Miscellaneous Application to reinstate the appeal if their case is not accepted under the Vivad Se Vishwas Scheme 2024 by the Revenue.

The Tribunal condoned the delay of 199 days in filing the appeals, citing reasonable and sufficient cause, and proceeded to adjudicate the appeals on merits. The Tribunal noted that both the Assessing Officer and the CIT(A) had passed ex-parte orders without providing adequate opportunity to the assessee.

The Tribunal condoned the delay of 199 days in filing the appeal, citing the assessee's medical condition and other sufficient reasons. The Tribunal observed that the AO and CIT(A) passed ex-parte orders without providing adequate opportunity. Applying the principles of natural justice, the Tribunal decided to remit the matter back to the AO for fresh consideration, granting the assessee one more opportunity to present evidence.

Given that the assessee's grievance regarding the TDS credit was resolved in the subsequent Section 143(3) assessment, the assessee requested to withdraw the appeal filed before the ITAT. With no objection from the Departmental Representative, the ITAT allowed the withdrawal of the appeal.

The Tribunal determined that the assessee's income from nursery and agricultural farm operations is indeed agricultural income, fully exempt under section 10(1). It observed that revenue authorities had accepted this character of income in prior and subsequent assessment years. The Tribunal concluded that merely misreporting income in the return should not preclude the assessee from claiming exemption, therefore directing the AO to delete the addition and setting aside the Ld.CIT(A)'s order.

The Tribunal upheld the Ld. CIT(E)'s decision to reject the application, finding that the assessee voluntarily filed a fresh application and failed to comply with notices. It stated that the Ld. CIT(E) was not obligated to guide the assessee or accept pleas of ignorance. The Tribunal also condoned an 86-day delay in filing the appeal, accepting the assessee's bonafide reasons.

The Tribunal condoned an 86-day delay in filing the appeal, acknowledging the assessee's genuine cause. However, on merits, the Tribunal upheld the Ld. CIT(E)'s decision, stating that the assessee voluntarily filed an incorrect application and failed to comply with notices, and its plea of ignorance regarding the provisions of the Act was not acceptable. The Tribunal ruled that it is not the duty of the Ld. CIT(E) to guide the assessee.

The Tribunal, noting bank statements showing debits of Rs. 13,00,000/- and Rs. 11,65,000/- and a confirmation from SBI for loans totaling Rs. 24,65,000/- availed by the assessee, found merit in the AR's arguments. It directed the AO to verify these loans and, if found correct, to treat the cash deposits as explained and make no addition.

The Tribunal held that no disallowance under Section 14A read with Rule 8D can be made if the assessee has not earned any exempt income. It further ruled that the Explanation to Section 14A, inserted by the Finance Act, 2022, is prospective in nature and therefore not applicable to the Assessment Year 2017-18.

The Tribunal dismissed the appeals as withdrawn. It granted the assessee liberty to file a Miscellaneous Application to reinstate the appeals if their application under the Vivad Se Vishwas Scheme 2024 is not accepted by the Revenue for any reason.

The Tribunal dismissed the appeals as withdrawn, granting the assessee liberty to approach the Tribunal again if their case is not accepted under the Vivad Se Vishwas Scheme 2024. This allows the assessee to file a Miscellaneous Application for reinstatement of the appeals within the prescribed time limit if necessary.

The Tribunal dismissed the appeal as withdrawn, granting the assessee liberty to file a Miscellaneous Application to reinstate the appeal if their case is not accepted under the Vivad Se Vishwas Scheme by the Revenue. Such an application must be filed within the time limit prescribed by the Act.

The Tribunal held that the filing of an audit report (Form 56F) is procedural and can be furnished at any time until the completion of assessment or even at the appeal stage. Citing judicial precedents and noting that a specific due date requirement for Section 10AA claims was introduced only from A.Y. 2024-25 by Finance Bill, 2023, the Tribunal concluded that the assessee was entitled to the enhanced deduction as the revised Form 56F was filed during assessment proceedings.

The Tribunal, adopting a liberal construction of 'sufficient cause' and citing judicial precedents, condoned the delays in filing the appeals. It remanded the cases back to the Ld. CIT(A) for deciding the appeals on merits, ensuring the assessee is given a proper opportunity of hearing.

The Tribunal condoned the delay in filing the appeals, emphasizing a liberal interpretation of 'sufficient cause' and prioritizing substantial justice over technicalities, citing Supreme Court precedents. The appeals were remanded back to the Ld. CIT(A) to be decided on merits after providing the assessee a sufficient opportunity of hearing.

Following its consistent view and that of other benches, the Tribunal held that Section 269SS does not apply to sale consideration received at the time of registration of a property, as it refers only to sums received as advance or otherwise. Therefore, it found no violation of Section 269SS and directed the Assessing Officer to delete the penalty levied under Section 271D.

The Tribunal allowed the withdrawal of the appeal as requested by the assessee. It clarified that if the assessee's case is not accepted under the 'Vivad Se Viswas' scheme by the Revenue, the assessee would be at liberty to file a Miscellaneous Petition before the Tribunal to reinstate the appeal.

The Tribunal allowed the assessee's request to withdraw the appeal, as the dispute was being settled under the Vivad-se-Vishwas Scheme 2024. The appeal was dismissed as withdrawn, with a provision for the assessee to approach the Tribunal if the settlement is not accepted by the Department.

The Tribunal upheld the Ld. DR's contention, determining that since the assessee's domicile is Mangaluru, Karnataka, the appeals should have been filed before the ITAT, Bengaluru, regardless of where the first appellate authority was located. Therefore, the appeals were dismissed for lack of territorial jurisdiction.

The tribunal concurred with the Departmental Representative, stating that the appeals ought to have been filed before the ITAT Bengaluru, as the assessee's original jurisdiction is Mangaluru. Consequently, the ITAT Visakhapatnam dismissed the appeals for lack of jurisdiction.

The Tribunal, following its previous decision in an identical case involving the assessee's sons, held that the actual sale consideration received by the assessee (Rs. 1,38,33,331/-) should be adopted for computing capital gains. This was due to the property being under dispute and pending litigation under the Urban Land (Ceiling and Regulation) Act, 1976, which made it impractical to fetch a higher market value.