“non application of mind”

Natural JusticeApplication of MindApplication of Mind701 judgments

The decision most relied on for non application of mind is CIT v. Max India Ltd. (295 ITR 282), cited in 1,162 judgments on BharatTax.

Leading authorities on non application of mind

CIT v. Max India Ltd.

295 ITR 282 · 2007 · Supreme Court

1,162

citing judgments

Under Section 263, an assessment order is not erroneous and prejudicial to the interest of the revenue merely because the Principal Commissioner disagrees with the Assessing Officer's (AO) view, particularly if the AO has adopted one of two permissible views in law, unless that view is completely unsustainable. If due inquiries were made, the AO's order does not become erroneous solely because the fact of inquiries was not recorded.

CIT v. Gabriel India Ltd.

203 ITR 108 · 1993 · High Court

990

citing judgments

The Commissioner cannot revise an assessment order under Section 263 merely because they hold a different opinion or believe a deeper inquiry was warranted if the Assessing Officer has applied their mind and conducted some inquiry. Revision under Section 263 is permissible only in cases of a complete lack of inquiry or non-application of mind by the Assessing Officer, not for merely inadequate inquiry.

Dilip N. Shroff v. JCIT

291 ITR 519 · 2007 · Supreme Court

565

citing judgments

A penalty notice issued under Section 271(1)(c) is invalid if the Assessing Officer fails to strike out the inapplicable limb (concealment or furnishing inaccurate particulars) from the standard proforma, indicating non-application of mind. The initial burden of proving concealment or inaccurate particulars rests on the Revenue.

CIT v. Kaushalya

216 ITR 660 · 1995 · High Court

511

citing judgments

A penalty levied under Section 271(1)(c) for concealment or furnishing inaccurate particulars of income is not invalidated by the Assessing Officer's failure to strike off irrelevant portions in the show cause notice, provided the assessee understood the exact charge and suffered no prejudice, indicating an application of mind by the AO.

CIT v. Manu Engg

122 ITR 306 · 1980 · High Court

505

citing judgments

When levying a penalty under Section 271(1)(c), the Assessing Officer must clearly specify whether it is for concealment of income or furnishing inaccurate particulars. An ambiguous notice or order using "and/or" for these limbs, or a standard proforma without striking irrelevant clauses, indicates non-application of mind and renders the penalty unsustainable.

PCIT v. Meenakshi Overseas Pvt. Ltd.

395 ITR 677 · 2017 · High Court

471

citing judgments

Reassessment proceedings initiated solely based on an investigation wing/appraisal report, without the Assessing Officer's independent application of mind to form a 'reason to believe' that income has escaped assessment, are beyond jurisdiction, bad in law, and void ab initio.

CIT v. Shri Samson Perinchery

392 ITR 4 · 2017 · High Court

417

citing judgments

A penalty levied under section 271(1)(c) of the Income-tax Act is unsustainable if it is initiated on one limb (e.g., concealment of income) but ultimately levied on the other limb (e.g., furnishing inaccurate particulars). This also applies if the initial penalty notice is vague or ambiguous regarding the specific charge.

CIT v. S. Goyanka Lime & Chemical Ltd.

64 Taxmann.com 313 · 2015 · Supreme Court

340

citing judgments

A mechanical approval by the prescribed authority under Section 151, made without independent application of mind, vitiates and renders the entire reassessment proceedings invalid. Such approvals, often indicated by brief, unreasoned endorsements, lead to the quashing of the reopening of assessment.

Judgments citing non application of mind

Assistant Commissioner of Income Tax, Circle1(1), Raipur vs. Akshay Lodha, Raipur

ITA 160/RPR/2022[2012-13]Status: DisposedITAT Raipur27 Oct 2023AY 2012-13

Bench: Shri Ravish Sood & Shri Arun Khodpiaआयकर अपील सं. / Ita No. 160/Rpr/2022 Co No.10/Rpr/2022 "नधा"रण वष" / Assessment Year : 2012-13 The Assistant Commissioner Of Income Tax, Circle-1(1), Raipur (C.G.) .......अपीलाथ" / Appellant बनाम / V/S. Shri Akshay Lodha B-26, 27 Gate No.11, Pandri, Textile Market Pandri, Raipur (C.G.) Pan : Acipl3634P ……""यथ" / Respondent

For Appellant: Shri R.B Doshi, CAFor Respondent: Shri Satya Prakash Sharma, Sr. DR

Section 147Section 250

case of the assessee. Also, the CIT(Appeals) was of the view that reopening of the assessee’s case was based on a non-application of mind by the A.O. It was 9 ACIT, Circle-1(1), Raipur Vs. Akshay Lodha CO. 10/RPR/2022 further observed by the CIT(Appeals) that ... reason to believe for reopening of the assessment under section 147 of the I.T Act, 1961. It is also proves a case of non application of mind on the part of the A.O not only in the reasons recorded but also in the assessment order. 2. The appellant has demonstrated

Madanlal Lodha, Raipur vs. Pr. Commissioner of Income Tax, Raipur-1

In the result, appeal of the assessee stands allowed

ITA 32/RPR/2022[2017-18]Status: DisposedITAT Raipur20 Oct 2023AY 2017-18

Bench: Shri Ravish Sood, Jm & Shri Arun Khodpia, Am आयकर अपील सं./Ita No: Ita 32/Rpr/2022 (Assessment Years:2017-18) Madanlal Lodha, V Pr. Commissioner Of Income Ta, C/O M/S Prakash Trading Comp. S Raipur-(I) Shop No. 109 & 110, Textile Market, Pandri, Raipur, (C.G.) (अपीलाथ"/Appellant) (""यथ" / Respondent) .. िनधा"रतीक"ओरसे /Assessee By : Shri R.B. Doshi, Ca राज"वक"ओरसे /Revenue By : Shri S.K. Meena, Cit-Dr सुनवाईक"तार"ख/ Date Of Hearing : 03-08-2023 घोषणाक"तार"ख/Date Of Pronouncement : 20-10-2023

For Appellant: Shri R.B. Doshi, CAFor Respondent: Shri S.K. Meena, CIT-DR

Section 143(3)Section 263Section 68Section 96

Considering the aforesaid facts and based on various case laws, it was concluded that on account of no enquiry on the issue shows non application of mind for reaching at a conclusion leads the order of Ld. AO to be held as erroneous so far as prejudicial to the interest

Hartron Sase Communications Ltd., New Delhi vs. DCIT, Circle- 11(1), New Delhi

In the result, the appeal of assessee is allowed in the manner as indicated above

ITA 1064/DEL/2018[2009-10]Status: DisposedITAT Delhi18 Oct 2023AY 2009-10

Bench: SHRI CHANDRA MOHAN GARG (Judicial Member), DR. B.R.R. KUMAR (Accountant Member)

For Appellant: Shri Anil Jain, CAFor Respondent: Shri Manish Tiwari, Sr. DR

Section 147Section 234ASection 68Section 69C

transaction/entry as to whether the same was unsecured loans or share application money or any other kind of bogus transaction which shows non application of mind by the Assessing Officer to the material received by him from the search and seizure operation on Jain Brothers. Thereafter, in para

Shark Packaging (India) Private Limited, Delhi vs. ITO, Ward-23(1), New Delhi

In the result, the appeal of the assessee for AY 2012-13 is partly allowed only on ground no

ITA 2163/DEL/2022[2008-09]Status: DisposedITAT Delhi17 Oct 2023AY 2008-09

Bench: Shri Chandra Mohan Garg & Shri Pradip Kumar Kedia

For Appellant: Shri Mayank Patawari, AdvFor Respondent: Shri Anuj Garg, Addl. CIT

Section 147Section 148Section 253Section 46ASection 68Section 69C

Joshi and that no accommodation entry has been provided by the Skylark Group companies to the assessee. Therefore, there has been a total non-application of mind in the reasons recorded by the Ld. AO. 20. Further drawing out attention towards para 2.2 and 2.3 of assessment order ... recording factually incorrect allegations without any evaluation and examination and the report of Investigation Wing Gurugram and other relevant material which shows non application of mind as in the reasons Assessing Officer alleged that the assessee has taken accommodation entry from the Skylark Group companies but while passing assessment order

Shark Packaging (India) Pvt Ltd, New Delhi vs. ITO Ward - 23(1), New Delhi

In the result, the appeal of the assessee for AY 2012-13 is partly allowed only on ground no

ITA 8310/DEL/2019[2012-13]Status: DisposedITAT Delhi17 Oct 2023AY 2012-13

Bench: Shri Chandra Mohan Garg & Shri Pradip Kumar Kedia

For Appellant: Shri Mayank Patawari, AdvFor Respondent: Shri Anuj Garg, Addl. CIT

Section 147Section 148Section 253Section 46ASection 68Section 69C

Shark Packaging (India) Pvt Ltd, New Delhi vs. ITO Ward - 23(1), New Delhi

In the result, the appeal of the assessee for AY 2012-13 is partly allowed only on ground no

ITA 8309/DEL/2019[2011-12]Status: DisposedITAT Delhi17 Oct 2023AY 2011-12

Bench: Shri Chandra Mohan Garg & Shri Pradip Kumar Kedia

For Appellant: Shri Mayank Patawari, AdvFor Respondent: Shri Anuj Garg, Addl. CIT

Section 147Section 148Section 253Section 46ASection 68Section 69C

Gudwala & Sons, Delhi vs. ACIT, Central Circle- 4, New Delhi

In the result, the appeal of the assessee is allowed

ITA 1919/DEL/2018[2015-16]Status: DisposedITAT Delhi06 Oct 2023AY 2015-16

Bench: Shri Chandra Mohan Garg & Shri Pradip Kumar Kedia

For Appellant: Shri Vishal Kalra, AdvFor Respondent: Shri Anuj Garg, Sr.DR

Section 131Section 132Section 133(6)Section 139(1)Section 143(3)Section 69A

found in the course of search as unaccounted stock. The stand taken by the CIT(A) is thus apparently contrary and reflects total non application of mind. The ld. counsel insisted that the statement recorded under Section 132(4) is not an incriminating material per se and cannot be used ... search. The ld. counsel thus submitted in conclusion that the action of the Assessing Officer and CIT(A) are marred by gross non application of mind and misconstruction of factual matrix. The CIT(A) while making the enhancement has taken self contradictory position and rejected the factum of cash sales

The Lake Palace Hotels & Motelsprivate Limited, Udaipur vs. PCIT, Circle-2, Udaipur

In the result, appeal of the assessee is allowed

ITA 52/JODH/2022[2017-18]Status: DisposedITAT Jodhpur27 Sept 2023AY 2017-18

Section 139(1)Section 142(1)Section 143(2)Section 143(3)Section 14ASection 263Section 36(1)(va)Section 43

facts on record. This in turn has resulted in passing of an erroneous order by the Assessing Officer in the case due to non application of mind to relevant material, incorrect assumption of facts and an incorrect application of mind to law, which is also prejudicial to the interest ... held that Order would be erroneous if it is based on an incorrect assumption of facts or an incorrect application of law or non-application of mind or based on no or insufficient materials. (iii) In the case of Arvee international vis, Addl. CIT (ITAT

Rama Shanker Khemka, New Delhi vs. Pr.CIT Delhi-1, New Delhi

In the result the appeal of the assessee in ITA No

ITA 1785/DEL/2023[2021-22]Status: DisposedITAT Delhi27 Sept 2023AY 2021-22

Bench: Shri N.K. Billaiya & Ms Astha Chandra

For Appellant: Shri Gautam Jain, AdvFor Respondent: Shri P.N. Barnwal, CIT- DR

Section 132Section 143(3)Section 263

devoid of any of the Act as devoid of any application of mind, making the assessment order non rest, then a non application of mind, making the assessment order non rest, then a non application of mind, making the assessment order non rest, then a non est-order cannot

Smt. Bharti Singh, Amritsar vs. Assistant Commissioner of Income Tax Circle-3, Amritsar

In the result, the appeal of the assessee is allowed for statistical

ITA 223/ASR/2023[2015-16]Status: HeardITAT Amritsar18 Sept 2023AY 2015-16

Bench: Dr. M. L. Meena & Sh. Anikesh Banerjee

For Appellant: Sh. Tarun Bansal, Adv. &

lost site to the fact and extract the fact of some other case by cut paste which shows non application of mind on the part of the ld. CIT(A) in adjudication of this appeal of the assessee. Accordingly, he requested that the matter may be remanded back

Gunjan Bhageria, New Delhi vs. ACIT, New Delhi

ITA 909/DEL/2022[2017-18]Status: DisposedITAT Delhi06 Sept 2023AY 2017-18

Bench: Shri N. K. Billaiya & Shri Anubhav Sharma

Section 127Section 142(1)Section 143(1)Section 143(2)Section 143(3)Section 263Section 285B

official act to have been done in due course and to justify the view but the same is rebuttable by establishing the non application of mind, as done by Ld. Pr CIT. The grounds raised have no substance and the appeal of assessee is dismissed. Order pronounced in the open

Aman Exports International, Jaipur vs. DCIT Circle 1, Jaipur

In the result, appeal of the assessee is partly allowed

ITA 147/JPR/2023[2012-13]Status: DisposedITAT Jaipur24 Aug 2023AY 2012-13

Bench: SHRI SANDEEP GOSAIN (Judicial Member), SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Sh. Manish Tatiwal (CA)For Respondent: Smt. Runi Pal (Addl. CIT) &

Section 142(1)Section 143(1)Section 143(2)Section 143(3)Section 148Section 40A(3)

spelt out that what he did with the information received by him from the Investigation wing, the reasons are also hit by non application of mind. That as the assessee made repeated written request to provide all the material relied upon, the learned assessing officer never supplied the same ... Subodh Chandra Das vs. ITO, ITA no. 2246 & 2247/Kol/2019, Mar 4, 2020 has held that reopening is bad in law, where there is non- application of mind by Assessing Officer to information received from investigation wing. The Hon’ble Delhi ITAT bench ‘SMC’ in Goel

Falguni Samir Mehta, Mumbai vs. ACIT-19(1), Mumbai

In the result, the appeal of the assessee is dismissed

ITA 1310/MUM/2023[2012-2013]Status: DisposedITAT Mumbai23 Aug 2023AY 2012-2013

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal () Assessment Year: 2012-13 Falguni Samir Mehta, Acit-19(1), 303, Mansarovar, Mount Pleasant Room No. 203, 2Nd Floor, Vs. Road, Mumbai-400006. Matru Mandir, Tardeo Road, Mumbai-400007. Pan No. Abeps 6347 K Appellant Respondent

For Appellant: Shri Ajay Gosalia / Isha ShahFor Respondent: Mr. Prakash D Choughule, Sr DR

Section 148Section 69C

Officer. According to the ld Counsel, the entire reassessment proceedings vitiates he entire reassessment proceedings vitiates he entire reassessment proceedings vitiates due to non application of mind by the to non application of mind by the Assessing officer. I ssessing officer. In support of contention, the Ld. Counsel

Shri Ajaya Kumar Chadda, Jalandhar vs. Income Tax Officer Ward-1 (1), Jalandhar

In the result, the appeal of the assessee is allowed

ITA 146/ASR/2023[2015-16]Status: DisposedITAT Amritsar23 Aug 2023AY 2015-16

Bench: Dr. M. L. Meena & Sh. Anikesh Banerjee

For Appellant: Sh. Navdeep Monga, Adv. &For Respondent: Sh. Mohit Kumar Nigam, Sr. DR

Section 271Section 271(1)(c)Section 274

category under which the default is blamed on the assessee. Consequently, the penalty order passed in consequence of such defective notice suffers from non application of mind and lack of satisfaction towards nature of default. It was further pointed out that the assessee belongs to Rockland Group of companies where ... under which limb of section 271(l)(c) penalty was proposed to be imposed and thus it would lead to an inference of non- application of mind, thus vitiating the imposition of penalty. Recently, the Ld. ITAT, Mumbai Bench in the case of I.G. International Pvt. Ltd. Vs. ACIT

Career Point Limited, Kota, Rajasthan vs. Principal Commissioner of Income Tax, Udaipur, Rajasthan

In the result, the appeal of the assessee is allowed

ITA 242/JPR/2023[2018-19]Status: DisposedITAT Jaipur22 Aug 2023AY 2018-19

Bench: HON’BLE SHRI SANDEEP GOSAIN, JM & HON’BLE SHRI RATHOD KAMLESH JAYANTBHAI (Accountant Member)

For Appellant: Shri Vijay Goyal, CA &For Respondent: Shri Ajey Malik (CIT)

Section 143(2)Section 143(3)Section 14ASection 263

Therefore, the order passed by ld FAO us not based on incorrect facts, assumption of wrong facts, or incorrect applicable of law or non application of mind etc. c) Arvee International vs CIT ITAT Mumbai 101 ITD 495This case is also not applicable to the case of assessee in hand

Rakesh Kumar Aggarwal, Delhi vs. ITO, Ward-40(3), New Delhi

In the result, the appeal of the assessee is thus allowed

ITA 699/DEL/2020[2009-10]Status: DisposedITAT Delhi17 Aug 2023AY 2009-10

Bench: Shri Kul Bharat & Shri Pradip Kumar Kedia

For Appellant: Shri Amit Goyal, CAFor Respondent: Shri Atiq Ahmed, Sr.DR

Section 143(3)Section 147Section 148Section 148(2)Section 151Section 234B

No.699/Del/2020 2 Assessing officer has not applied his mind in recording satisfaction note for re-opening the assessment. It is further submitted that non-application of mind by the superior authorities while giving approval for re-opening the assessment. 2. That Learned C.I.T.(A) has erred in law in confirming ... Explanation to Section 147 has been purportedly referred, in that case also, such approval requires to be condemned as it glaringly suffers from non application of mind. Clause (b) to Explanation 2 applies only where a return of income has been furnished by the assessee but no assessment has been

DCIT, Central Circle-8, New Delhi vs. Bhaijee Commodities Pvt. Ltd., Delhi

ITA 9133/DEL/2019[2010-11]Status: DisposedITAT Delhi07 Aug 2023AY 2010-11

Bench: Shri Chandra Mohan Garg & Shri Pradip Kumar Kedia

For Appellant: Shri Surinder Mahajan CAFor Respondent: Shri Kanav Bali, Sr.DR

Section 133(6)Section 147Section 148Section 151Section 68

also merrily granted approval under S. 151 to reopen the case of assessee despite such allegation qua a different entity showing obvious non application of mind, first by the AO and by the PCIT as a sequel thereto. The Assessing Officer in the reasons recorded has alleged fictitious gains aggregating ... Assessing Officer are devoid of ‘reason to believe’ and are without application of mind, the approval of PCIT under s. 151 suffers from non application of mind for yet another reason. As per the approval memo presented by the AO before PCIT for his approval, the Assessing Officer stated that

Bhaijee Commodities Pvt. Ltd., New Delhi vs. ACIT Circle-4(2), New Delhi

ITA 7921/DEL/2019[2010-11]Status: DisposedITAT Delhi07 Aug 2023AY 2010-11

Bench: Shri Chandra Mohan Garg & Shri Pradip Kumar Kedia

For Appellant: Shri Surinder Mahajan CAFor Respondent: Shri Kanav Bali, Sr.DR

Section 133(6)Section 147Section 148Section 151Section 68

Ultratech Cement Limited, Mumbai vs. ACIT- CC -1(4), Mumbai

ITA 221/MUM/2022[2012-13]Status: DisposedITAT Mumbai03 Aug 2023AY 2012-13

Bench: Shri Kuldip Singh & Shri S Rifaur Rahmanassessment Year: 2012-13

For Appellant: Shri. Nitesh Joshi, A.R. &For Respondent: Shri. Alok Kumar, CIT DR

Section 132Section 143(3)Section 153CSection 35D

clearly indicate that the AO has not examined the issue of deduction claimed towards stamp duty paid on 'demerger of units which shows non application of mind by the AO to the facts in the right-perspective: of specific provisions of section 35DD of the Act. Therefore

Allied Photographics India Ltd., Mumbai vs. PCIT, Mumbai-1, Mumbai

In the result, the appeal filed by the assessee is allowed

ITA 1083/MUM/2023[2018-19]Status: DisposedITAT Mumbai01 Aug 2023AY 2018-19

Bench: Shir Pavan Kumar Gadale & Shri S Rifaur Rahmanm/S Alliedphotographics Vs. Pr.Cit-1, India Ltd., 3Rd Floor, Room No.330, Kasturi Buildings, 3Rd Floor, Jamshedji Tata Road, Aayakar Bhavan, Churchgate, M.K. Road, Mumbai -400020. Mumbai-400020. Pan/Gir No. : Aabca2068A Appellant .. Respondent Appellant By : Mr.Nitish Gandhi.Ar Respondent By : Ms.Smiti Samant. Dr Date Of Hearing 15.06.2023 Date Of Pronouncement 02.08.2023 आदेश / O R D E R Per Pavan Kumar Gadale Jm: The Assessee Has Filed The Appeal Against The Order Of The Pr. Commissioner Of Income Tax (Pr.Cit)-1, Mumbai Passed U/S 263 Of The Act. The Assessee Has Raised The Fallowing Grounds Of Appeal.

For Appellant: Mr.Nitish Gandhi.ARFor Respondent: Ms.Smiti Samant. DR

Section 10Section 143(3)Section 2(14)Section 2(14)(iii)Section 263

notice u/s 142(1) of the Act and hence ITA Nos. 1083/Mum/2023 M/s Allied Photographics India Ltd. Mumbai. there cannot be any non application of mind by the A.O. Whereas the observations of the Pr. CIT are not correct that, the agricultural land is situated within the limits of municipality ... order of ITO observing that order of ITO did not contain discussion in regard to allow ability of claim for deduction which indicated non-application of mind and that claim of assessee required examination as to whether expenditure in question was a revenue or capital expenditure and directed