ITAT Visakhapatnam Judgments — March 2025

The tribunal found that the assessee was not validly notified about the hearing dates by the CIT(A), as notices were sent to an email ID from the Income Tax Return (ITR) instead of the specific email provided in Form No.35 for the appeal. This constituted a denial of a reasonable opportunity of being heard. Consequently, the matter is remanded back to the CIT(A) for fresh adjudication after providing the assessee a proper opportunity of being heard.

The tribunal found that the assessee was not validly notified about the hearing dates by the CIT(A), as notices were sent to an email ID from the Income Tax Return (ITR) instead of the specific email provided in Form No.35 for the appeal. This constituted a denial of a reasonable opportunity of being heard. Consequently, the matter is remanded back to the CIT(A) for fresh adjudication after providing the assessee a proper opportunity of being heard.

The ITAT held that the CIT(A) erred by dismissing the appeal ex-parte without addressing or passing a speaking order on the additional documentary evidence filed by the assessee under Rule 46A of the Income-tax Rules, 1962. The matter was remitted back to the file of the CIT(A) with a direction to re-adjudicate the appeal after considering the additional evidence and affording a reasonable opportunity of being heard to the assessee.

The Tribunal found that the assessee had specifically opted out of email communication in its Form-35 and was not physically served with a notice for the CIT(A) hearing. Consequently, the assessee was deprived of a reasonable opportunity of being heard. The Tribunal set aside the CIT(A)'s order and restored the matter for fresh adjudication, directing the CIT(A) to afford the assessee a proper opportunity to present its case and evidence.

The Tribunal held that the CIT erred in invoking Section 263 without establishing that the Assessing Officer's order was erroneous and prejudicial to the revenue. The CIT failed to demonstrate that the Assessing Officer did not examine the issues properly.

The Tribunal noted that while the assessee provided evidence of the partnership and bank account conversion, neither the AO nor the CIT(A) adequately verified if the cash deposits were properly accounted for in the partnership firm's books. Therefore, the Tribunal set aside the CIT(A)'s order and remanded the matter back to the AO for de novo verification and a decision after giving the assessee an opportunity to be heard.

For AY 2018-19, the Tribunal held that once the Section 148 notice and subsequent assessment were declared invalid due to sanction by CIT instead of the competent authority (CCIT/PCCIT) under Section 151, the CIT(A) erred in upholding additions on merits. For AY 2019-20, the Tribunal observed that the assessee's claim of mutuality and its audited books were not adequately considered, remitting the matter back to the AO for de novo verification of the source of deposits and the mutuality principle.

The Tribunal held that the additional income of Rs. 11 lakh should be assessed as business income, taxable at normal rates, and not as unexplained money under Section 69A read with Section 115BBE. It noted that the assessee was engaged in business, had no other source of income, maintained regular books (though not at residence), and presented evidence of business activity, supported by prior ITAT decisions.

The Tribunal observed that the AO allowed interest expenditure for AY 2020-21 when income was treated as 'income from other sources'. It set aside the CIT(A)'s order, remanding the case back to the Assessing Officer to re-examine the allowance of deduction for interest on borrowed capital for the impugned assessment years and to rectify errors in the computation sheets.

The Tribunal held that unsecured loans from one creditor (MV Rathnam) were genuine and directed deletion of the addition. It also deleted the addition for loans from M. Kameswara Rao and MV Rathnam, stating that if part of the loan was genuine, the entire amount could not be treated as unexplained. The Tribunal further held that additions under Section 68 cannot be considered as gross receipts for the purpose of the exemption threshold limit.

The Tribunal observed that the CIT(E) did not specify which activities were not charitable, despite the assessee having been previously granted registration under Section 12AB. Finding that the assessee incurred substantial expenditure, the Tribunal set aside the CIT(E)'s order and remanded the matter for reconsideration.

The Tribunal observed that the AO allowed interest expenditure for AY 2020-21 when income was treated as 'income from other sources'. It set aside the CIT(A)'s order, remanding the case back to the Assessing Officer to re-examine the allowance of deduction for interest on borrowed capital for the impugned assessment years and to rectify errors in the computation sheets.

The Tribunal observed that the AO allowed interest expenditure for AY 2020-21 when income was treated as 'income from other sources'. It set aside the CIT(A)'s order, remanding the case back to the Assessing Officer to re-examine the allowance of deduction for interest on borrowed capital for the impugned assessment years and to rectify errors in the computation sheets.

The Tribunal observed that the AO allowed interest expenditure for AY 2020-21 when income was treated as 'income from other sources'. It set aside the CIT(A)'s order, remanding the case back to the Assessing Officer to re-examine the allowance of deduction for interest on borrowed capital for the impugned assessment years and to rectify errors in the computation sheets.

The Tribunal observed that the AO allowed interest expenditure for AY 2020-21 when income was treated as 'income from other sources'. It set aside the CIT(A)'s order, remanding the case back to the Assessing Officer to re-examine the allowance of deduction for interest on borrowed capital for the impugned assessment years and to rectify errors in the computation sheets.

For AY 2018-19, the Tribunal held that once the Section 148 notice and subsequent assessment were declared invalid due to sanction by CIT instead of the competent authority (CCIT/PCCIT) under Section 151, the CIT(A) erred in upholding additions on merits. For AY 2019-20, the Tribunal observed that the assessee's claim of mutuality and its audited books were not adequately considered, remitting the matter back to the AO for de novo verification of the source of deposits and the mutuality principle.

The Tribunal held that the satisfaction note recorded by the Assessing Officer of the searched person was not valid, thus vitiating the assessment proceedings under Section 153C for A.Y. 2016-17 and 2017-18. For A.Y. 2018-19, the Tribunal directed the AO to estimate 25% profit on unaccounted receipts.

The Tribunal held that the satisfaction note recorded by the Assessing Officer of the searched person was not valid, thus vitiating the assessment proceedings under Section 153C for A.Y. 2016-17 and 2017-18. For A.Y. 2018-19, the Tribunal directed the AO to estimate 25% profit on unaccounted receipts.

The Tribunal held that the satisfaction note recorded by the Assessing Officer of the searched person was not valid, thus vitiating the assessment proceedings under Section 153C for A.Y. 2016-17 and 2017-18. For A.Y. 2018-19, the Tribunal directed the AO to estimate 25% profit on unaccounted receipts.

The Tribunal found that the assessee's grandfather had entered into an agreement for sale on 16.10.2012, and the entire consideration was paid on or before that date, a fact not disputed by the AO. Applying the first proviso to Section 56(2)(vii)(b), the Tribunal held that when the agreement date and consideration payment precede the registration date, the stamp duty value as of the agreement date should be considered. Therefore, the addition based on the registration date's stamp duty value was incorrect, and the order of the CIT(A) was set aside.

The Tribunal acknowledged the 40-day delay and the CIT(A)'s failure to consider the condonation petition. Referring to the Supreme Court's pronouncement on extended limitation periods due to the pandemic (15/03/2020 to 28/02/2022), the Tribunal condoned the delay. It directed the learned CIT(A) to admit the appeal for a proper hearing after providing an opportunity to the assessee.

The learned counsel for the assessee requested to withdraw the appeal, and the Department Representative offered no objection. Consequently, the tribunal allowed the withdrawal, dismissing the appeal as such.

The Tribunal held that the Specified Bank Notes (Cessation of Liabilities) Act, 2017, did not restrict dealing with SBNs until 31.12.2016. Since the assessee had explained the source of cash deposits from business sales, and this explanation was not disputed by the AO, the additions made under Section 69A were ordered to be deleted, supported by judicial precedents.

The Tribunal found that the CIT(A) dismissed the appeal 'in limine' without considering merits, notwithstanding the assessee's submission of relevant details including the assessment order and Form 35. The Tribunal set aside the CIT(A)'s order and remitted the matter back to the AO for a 'de novo' assessment, granting the assessee another opportunity to be heard and present evidence, subject to payment of a nominal cost of Rs.5,000/- for negligence.

The Tribunal partly allowed the assessee's appeal, deleting additions related to cash deposits explained by gold loans and withdrawals from the same bank account. However, additions related to unexplained gift from father and loan from Mr. D. Satish were sustained.

The Income Tax Appellate Tribunal dismissed the appeal as withdrawn, acknowledging the settlement of the tax dispute under the Vivad Se Vishwas Scheme, 2024. The Tribunal also granted the assessee liberty to apply for reinstatement of the appeal if the Vivad Se Vishwas application is rejected for any reason.

The Tribunal found that the Ld. CIT (Exemption) rejected the application without properly specifying what constituted commercial activities and without due consideration of the documents submitted by the assessee. Therefore, the matter was remitted back to the Ld. CIT (Exemption) to re-examine the documents and submissions, and decide on the Section 80G registration after providing a reasonable opportunity of being heard to the assessee.

The assessee's appeals against the quantum addition and penalty before the CIT(A) were filed with significant delays (457 and 279 days respectively), citing ill health. The CIT(A) dismissed these appeals in limine due to the absence of cogent evidence to condone the delay. The ITAT upheld the CIT(A)'s decision, finding no infirmity as the assessee failed to provide sufficient or reasonable cause and supporting evidence for the delay even before the tribunal.

The Tribunal noted that the assessee failed to provide documentary evidence for the cash deposits. However, it allowed the assessee's ground of appeal regarding the applicability of the higher tax rate under Section 115BBE for the assessment year in question.

The Tribunal found no infirmity in the CIT(A)'s order regarding the addition of unexplained income. However, it allowed the assessee's ground concerning the applicability of the higher tax rate under Section 115BBE, following a High Court decision.

The Tribunal held that the assessment order was bad in law due to the failure to issue a notice under Section 143(2) of the Act, even though the return was filed belatedly. The assessment order was quashed.

The Tribunal held that the assessment order passed under Section 143(3) without issuing a mandatory notice under Section 153C, when material seized from another entity was used, is void ab initio and cannot be sustained.

The Tribunal held that the digital evidence from the pen drive was inadmissible as it was not seized following prescribed methods. The revenue failed to provide corroborating evidence for the alleged cash interest payments.

The Tribunal held that electronic evidence, such as the contents of a pen drive, is inadmissible if not accompanied by a certificate as required by Section 65B of the Indian Evidence Act. Therefore, additions based solely on such inadmissible evidence cannot be sustained.

The ITAT found that the CIT(A) did not comply with Section 250(6) of the Income Tax Act by dismissing the appeal ex-parte without considering the merits. The Tribunal held that even in the assessee's absence, the CIT(A) should have dealt with the matter on merits. The impugned order was set aside and the case was remanded to the CIT(A) for fresh adjudication on merits.

The Income Tax Appellate Tribunal remitted the matter back to the Assessing Officer, directing that the assessee be given one more opportunity to provide documentary evidence to substantiate the cash deposits. The AO is to examine the evidence and decide the matter on merits, adhering to principles of natural justice.

The Tribunal held that Section 68 of the Income Tax Act applies only when sums are found credited in the 'books of account maintained by the assessee'. Since the Assessing Officer himself acknowledged that the assessee did not maintain books of account, the addition made under Section 68 was legally unsustainable and deserved to be deleted.

The Tribunal found that the core issue in the present appeal, arising from the U/s. 143(1) intimation, was identical to the issue already remitted to the CIT(A) by a previous Tribunal order (ITA No. 313/Viz/2023) for statistical purposes and affording an opportunity of hearing. Consequently, the current appeal was deemed infructuous.

The Tribunal acknowledged the assessee's argument that the delay in filing the appeal was due to technical issues with the ITBA portal, which was not enabled, and the non-upload of the assessment order. Considering these circumstances, the ITAT remitted the matter back to the Ld. CIT(A) with a direction to consider the assessee's condonation petition and then decide the appeal on its merits.

The assessee's appeals against the quantum addition and penalty before the CIT(A) were filed with significant delays (457 and 279 days respectively), citing ill health. The CIT(A) dismissed these appeals in limine due to the absence of cogent evidence to condone the delay. The ITAT upheld the CIT(A)'s decision, finding no infirmity as the assessee failed to provide sufficient or reasonable cause and supporting evidence for the delay even before the tribunal.

The Tribunal noted that the CIT(A) dismissed the appeal without considering the merits, despite the assessee not appearing. The Tribunal found it a fit case to quash the order and restore the issue to the AO.

The Tribunal held that the digital evidence from the pen drive was inadmissible as it did not comply with the provisions of Section 65B of the Indian Evidence Act. Therefore, the addition made by the AO based on this evidence was unsustainable.

The Income Tax Appellate Tribunal (ITAT) agreed with the CIT(A)'s directions for computing income under both 'capital gain' and 'business income' heads, considering the conversion of agricultural land into stock-in-trade. Finding the CIT(A)'s dismissal of the appeal inconsistent with its own findings, the ITAT allowed the assessee's appeal.

The Tribunal admitted the additional evidences presented by the assessee (confirmation letters and bank statements) as they were deemed necessary for a fair adjudication. The case was remitted back to the Assessing Officer to re-examine these evidences and complete the assessment de novo in accordance with law.

The Tribunal noted that the assessee failed to appear or submit evidence despite multiple opportunities provided by the AO and CIT(A). However, in the interest of natural justice, the Tribunal decided to remit the matter back to the Ld. CIT(A) for fresh consideration on merits, directing the assessee to cooperate.

The Tribunal observed that the Ld. CIT(A) had passed an ex-parte order, denying the assessee an adequate opportunity of being heard despite repeated notices. To ensure principles of natural justice and provide substantial justice, the Tribunal decided to remit the matter back to the Ld. CIT(A) for fresh consideration on merits, directing the assessee to cooperate.

The Tribunal found that the assessee had provided sufficient evidence of charitable activities, including ITR acknowledgements, audit reports, financials, and trust deeds. The CIT(E) had not specified which activities were not charitable.

The Tribunal, acknowledging that the assessee was not given a proper opportunity of being heard by the CIT(A), remitted the matter back to the Ld. CIT(A). This remand is for a fresh consideration of the appeal on merits, granting the assessee one more opportunity to present her case, with a caution for future cooperation.

The Tribunal, upon examining the affidavit and medical records of the assessee's counsel, found a reasonable and sufficient cause for the 165-day delay, attributable to the counsel's Covid-19 illness, hospitalization, and subsequent operational disruptions. Consequently, the Tribunal condoned the delay and remitted the matter back to the CIT(A) to decide the appeal on its merits after affording the assessee a proper opportunity.

The Tribunal found the CIT(E)'s order cryptic as it failed to specify which activities were not charitable. Consequently, the Tribunal set aside the impugned order and remanded the matter back to the CIT(E) for fresh consideration, directing an opportunity for the assessee to be heard and the issuance of a speaking order.