ITAT Weekly Round-Up [April 1st-26th]

This weekly round-up analytically summarises the key stories related to the Income Tax Appellate Tribunal (ITAT) reported at Taxscan during this month from April 1st to April 6th 2025

CIT(A) failed to consider Factual Mistake Committed by CPC: ITAT Directs AO to Delete Adjustment of Rs. 3.09 Crore

Landis +Gyr Limited vs DCIT, Cir.1(1) CITATION: 2025 TAXSCAN (ITAT) 685

The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to delete the adjustment of Rs. 3.09 crores as the Commissioner of Income Tax (Appeals) [CIT(A)] failed to consider the factual mistake committed by the Centralized Processing Centre (CPC). The issue in this case is that the CPC flagged a mismatch involving a GST adjustment of Rs. 5.74 crore, which the system erroneously treated as an item falling under Section 28 of the Income Tax Act (income chargeable under business profits). The CIT(A) upheld the CPC’s adjustment, noting that the assessee had failed to correct the error in Form 3CD and that the auditors had incorrectly reported the amount.

Timely Payment of Appeal Fee: ITAT Remands Case to CIT(A) for Fresh Adjudication After Condoning 5-Day Delay

Falguni Ajay Panchmatia vs Assistant Commissioner of Income-tax CITATION: 2025 TAXSCAN (ITAT) 686

The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) remanded the matter back to the Commissioner of Income Tax (Appeals) [CIT(A)] for denovo meritorious adjudication after condoning a delay of 5 days in filing the appeal noting the timely payment of appeal fees. The assessee, Falguni Ajay Panchmatia, had appealed against the order passed by the CIT(A) under Section 143(3) of the Income Tax Act, 1961 for the assessment year (AY) 2014-15.

The ITAT remanded the matter back to the CIT(A) and directed the latter to condone the delay of 5 days and to take up the matter for denovo meritorious adjudication on the grounds raised by the assessee at the first appellate stage. The order also stated that the assessee should be given a reasonable opportunity to be heard and to make any further submissions. In conclusion, the grounds raised by the assessee were allowed for statistical purposes.

Assessment Proceedings u/s 151A and SCN Passed without Jurisdiction: ITAT quashes NFAC’s orders

MD Mahimud SK vs ITO CITATION: 2025 TAXSCAN (ITAT) 687

The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) quashed the orders passed by the National Faceless Assessment Centre’s orders as the latter observed that the assessment proceedings under Section 151A of the Income Tax Act, 1961, as well as the show cause notice (SCN), were issued without jurisdiction. In this case, the assessee, Md. Mahimud SK, appealed against the orders of the NFAC and the Commissioner of Income Tax (Appeals) [CIT(A)], which had upheld additions of Rs. 21,06,182 to his income for assessment year (AY) 2015-16 on account of unexplained credits in his bank accounts.

Proper compliance on part of Assessee during Assessment Stage: ITAT Remands Case for Denovo Adjudication

Udaylal Hiralal Jain Shop No.8 vs Income-tax Officer CITATION: 2025 TAXSCAN (ITAT) 688

The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) remanded the case of fresh adjudication after noting the assessee’s compliance. In this case, the assessee, Udayal Hiralal Jain, had appealed against the order by the Commissioner of Income Tax (Appeals) [CIT(A)] under Section 147 of the Income Tax Act, 1961 for the assessment year 2016-17. The appeal filed by the assessee was dismissed by the CIT(A) by noting that the assessee remained non-compliant even after being provided with multiple opportunities. The assessee did not bring any material on record in support of the grounds of appeal or to refute the findings of the Assessing Officer (AO).

ITAT Favours JCB India: Rejects Arbitrary Royalty Adjustments, Directs TPO to Follow Advance Pricing Agreement Standards

JCB India Ltd vs ACIT CITATION: 2025 TAXSCAN (ITAT) 689

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT)set aside an arbitrary transfer pricing adjustment on royalty payments and directed the Transfer Pricing Officer (TPO) to align with the Advance Pricing Agreement (APA) parameters. The assessee, JCB India, is the Indian subsidiary of a multinational company engaged in the manufacturing and trading of construction equipment, spare parts, and components. The company had entered into Technology Transfer Agreements (TTA) with its associated enterprises (AEs) to receive proprietary technology, allowing it to manufacture and sell technologically advanced products.

ITAT Allows Bad Debt Write-Off w/o Proof of Irrevocability, Protects Legitimate Transactions

ACIT vs Goenka Trading CITATION: 2025 TAXSCAN (ITAT) 690

In a recent case, the Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that writing off bad debt in the books is enough for deduction, without the need to prove irrecoverability. Goenka Trading, a registered partnership firm, is engaged in diamond and commodity trading, as well as share trading and futures & options transactions. The assessee filed its income tax return, reporting a loss of ₹5.94 crore. The return was selected for scrutiny assessment by the Assessing Officer (AO).

ITAT Quashes PCIT’s Order u/s 263 for Relying on Audit Objection

Vaneet Gupta vs The ITO CITATION: 2025 TAXSCAN (ITAT) 691

The Chandigarh bench of the Income Tax Appellate Tribunal (ITAT) held that Section 263 of the Income Tax Act, 1961, which empowers the Principal Commissioner of Income Tax (PCIT) to revise assessments, cannot be invoked solely on the basis of an audit objection. In March 2018, the assessee, Vaneet Gupta, was served an income tax notice u/s 148, questioning a ₹1.1 crore investment on a property and ₹43.2 lakh cash deposits in a joint bank account. In response, he explained that the property belonged to his wife and was transferred to him via a sale deed, with payment made at that time. He also clarified that the joint bank account with his wife had already been assessed during the relevant assessment year.

Denial of Fair Opportunity and Inadequate Evidence Examination: ITAT Restores Matter to AO

Jignesh Shah vs The Asst.CIT CITATION: 2025 TAXSCAN (ITAT) 697

The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT)restored the matter to the Assessing Officer (AO) after finding that the Commissioner of Income Tax (Appeals)[CIT(A)] had denied the assessee a fair opportunity to present evidence and had failed to adequately examine the provided documents. Jignesh Shah,appellant-assessee,filed his return of income for Assessment Year 2022-23 on 31/12/2022, declaring Rs.64,87,610/- as total income. The case was selected for scrutiny, and multiple notices were issued between 01/06/2023 and 07/03/2024. Despite several reminders, the assessee failed to provide complete information and did not submit crucial documents like loan confirmations and cash deposit reconciliations.

Non-Prosecution of Appeal Due to Non-Issuance of Notices: ITAT Remits Matter to AO

SHRI RAKESH vs ITO, WARD 3(4) CITATION: 2025 TAXSCAN (ITAT) 693

The Delhi Bench of Income Tax Appellate Tribunal(ITAT)  remitted the matter to the Assessing Officer (AO) for fresh adjudication after finding that the appeal was dismissed due to non-prosecution, as the notices were not issued to the updated email address provided by the assessee. Rakesh,appellant-assessee,filed his return for the assessment year 2011-12 under section 148, reporting an income of Rs. 1,58,518 on February 5, 2019. The assessment was finalized under section 144, with the AO classifying a cash deposit of Rs. 78,25,000 as unexplained under section 68 of the Act. The Commissioner of Income Tax(Appeals)[CIT(A)] confirmed the AO’s decision and rejected the appeal of the assessee.

Unexplained Cash Deposit During Demonetization: ITAT deletes Addition, Accepts Mother’s Savings Claim

Shri. Devadass Suresh vs DCIT CITATION: 2025 TAXSCAN (ITAT) 700

The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) deleted addition of Rs.9,00,500/- made by the Assessing Officer(AO) during demonetization, accepting the claim that a significant portion of the deposit came from the assessee’s mother’s lifetime savings. Devadass Suresh, appellant-assessee, filed a return of income on 25.09.2017, declaring Rs.2,99,310/-. During scrutiny, the AO found a cash deposit of Rs.9,00,500/- in the appellant’s Post Office account between 09.11.2016 and 30.12.2016. Since the assessee failed to explain the deposit, the AO treated it as unexplained money under section 69A of the Act.

Estimation of Gross Profit Rate and Unverifiable Purchases: ITAT Upholds CIT(A)’s Decision to Limit GP to 1%

ITO vs NEERAJ KUMAR CITATION: 2025 TAXSCAN (ITAT) 695

The Delhi Bench of Income Tax Appellate Tribunal ( ITAT ) upheld the Commissioner of Income Tax(Appeals)[CIT(A)]’s decision to limit the gross profit ( GP ) rate to 1% for the Assessment Year (AY)2012-13, rejecting the assessee’s challenge against the enhanced GP rate and unverifiable purchases. Neeraj Kumar, appellant-assessee, filed a cross appeal against the order dated 03.07.2017 passed by CIT(A) for the Assessment Year 2012-13. The assessment order under section 144 of the Act was passed on 28.03.2016, with the Assessing Officer(AO) rejecting the books of accounts. As a result, the following additions were made: Rs. 39,62,489/- for an enhanced GP rate, Rs. 3,17,76,113/- for unverifiable purchases and sundry creditors, Rs. 1,18,82,031/- for understated sales, Rs. 1,44,925/- for unverifiable expenses, Rs. 1,85,599/- for an unexplained addition to the capital account, and Rs. 6,02,350/- for explained credits in the PNB account.

Penalty proceedings u/s 271B for late filing of audit report: ITAT sets aside Pr.CIT’s order for lack of jurisdiction

Shri. Kumaraswamy Gangadharaiah Kallur vs DCIT CITATION: 2025 TAXSCAN (ITAT) 696

The Bangalore Bench of Income Tax Appellate Tribunal ( ITAT ) sets aside Principal Commissioner of Income Tax[Pr.CIT]’s order on penalty proceedings under section 271B of Income Tax Act,1961 for late filing of audit report due to lack of jurisdiction. Kumaraswamy Gangadharaiah Kallur, appellant-assessee, filed a return on 28.02.2015, showing an income of Rs. 1,08,58,460/-. The Assessing Officer(AO) accepted this return in an assessment order on 16.12.2016. Later, it was found that the appellant-assessee did not disclose the source of credit card expenses or provide details of investments related to multi-commodity transactions, which required 10% of peak transactions to be invested with the broker.

Ad-hoc Disallowance of Expenses for Lack of Documents: ITAT Upholds CIT(A)’s Deletion of Rs. 5.92 Crore Addition

Assistant CIT Circle-2(1)(1) Ahmedabad vs H.V. Infratex Ltd. CITATION: 2025 TAXSCAN (ITAT) 699

The Ahmedabad Bench of Income Tax Appellate Tribunal(ITAT) upheld the deletion of the Rs. 5.92 crore disallowance made on an ad-hoc basis due to lack of supporting documents. The Revenue-appellant, appealed against the order dated  30.10.2023,passed by Commissioner of Income Tax(Appeals) [CIT(A)] for the Assessment  Year 2016-17.In this case, H.V. Infratex Ltd.,respondent-assessee,involved in government civil and construction contracts, filed its return for A.Y. 2016-17 on 17.10.2016, declaring total income of Rs. 49,20,980/- and book profit of Rs. 61,33,174/-.

ITAT Rejects Revenue’s Objection on Additional Evidence, Finds CIT(A) Acted Within Section 250(4) Powers

Assistant CIT Circle-2(1)(1) Ahmedabad vs H.V. Infratex Ltd. CITATION: 2025 TAXSCAN (ITAT) 699

The Ahmedabad Bench of Income Tax Appellate Tribunal(ITAT)  rejected the Revenue’s objection regarding the admission of additional evidence by the Commissioner of Income Tax (Appeals) [CIT(A)] and upheld that the CIT(A) acted within its powers under Section 250(4) of the Income Tax Act,1961. The Revenue-appellant, appealed against the order dated  30.10.2023,passed by CIT(A) for the Assessment  Year 2016-17.In this case, H.V. Infratex Ltd.,respondent-assessee,involved in government civil and construction contracts, filed its return for A.Y. 2016-17 on 17.10.2016, declaring total income of Rs. 49,20,980/- and book profit of Rs. 61,33,174/-.

Failure to Claim TDS Credit in Return: ITAT Upholds CIT(A) Decision to Allow Credit after Verification

DCIT vs RAVI INTEGRATED LOGISTICS (INDIA) PVT. LTD CITATION: 2025 TAXSCAN (ITAT) 692

The Delhi Bench of Income Tax Appellate Tribunal (ITAT) upheld the Commissioner of Income Tax(Appeals) [CIT(A)] decision to allow the Tax Deducted at Source (TDS) credit after verifying the corresponding income, despite the failure to claim it in the return. The Revenue-appellant appealed against the order dated 10.07.2024, passed by CIT(A) for the Assessment Year 2022-23. In this case, Ravi Integrated Logistics(India) Pvt.Ltd., respondent-assessee,failed to claim the TDS credit in its return, even though it was reflected in the accounts and Form 26AS. As a result, the Centralized Processing Center (CPC) did not provide the TDS benefit.

Non-Compliance With S.40A(3) in Cash Payments: ITAT Remands Case to CIT(A) With Rs.2,000 Cost

Shree Prithvi Steel Rolling Mills Private Limited vs Dy. CIT CITATION: 2025 TAXSCAN (ITAT) 694

The Jaipur Bench of Income Tax Appellate Tribunal(ITAT) remanded the matter to Commissioner of Income Tax (Appeals) [CIT(A)] due to non-compliance with Section 40A(3) of Income Tax Act,1961 in cash payments, imposing a cost of Rs. 2,000. Prithvi Steel Rolling Mills Private Limited,appellant-assessee, had appealed against the dismissal of its case by the CIT(A) under Section 250 of the Act. The CIT(A) agreed with the Assessing Officer(AO)’s decision to add Rs. 7,49,610 under Section 40A(3) due to non-compliance by the appellant during the appeal process.

ITAT Dismisses Revenue’s Appeal as Reassessment Under Section 147/148 Invalid Due to Third-Party Search Evidence

Deputy Commissioner of Income Tax vs Sh. Kailash Chand Hirawat 9 CITATION: 2025 TAXSCAN (ITAT) 698

The Jaipur Bench of Income Tax Appellate Tribunal(ITAT) dismissed the Revenue’s appeal, holding that reassessment under Section 147/148 of Income Tax Act,1961 was invalid due to reliance on third-party search evidence. The Revenue-appellant, appealed against the order passed by  Commissioner of Income Tax(Appeals)[CIT(A)] dated 18.07.2024. In this case, Kailash Chand Hirawat, respondent-assessee,was reassessed after the Assessing Officer(AO), in an order dated December 8, 2018, made additions of Rs. 3,61,00,000 and Rs. 17,93,000.

ITAT Quashes PCIT’s Order u/s 263 Against Bharti Airtel, Holds Interest and Penalty on License Fee as Revenue Expenditure

Bharti Airtel Limited vs Principal CIT CITATION: 2025 TAXSCAN (ITAT) 703

In a recent ruling, the Delhi Bench of the Income Tax Appellate Tribunal (ITAT) quashed the revisionary order passed by the Principal Commissioner of Income Tax (PCIT) under Section 263 of the Income Tax Act, 1961, against Bharti Airtel Limited. The tribunal held that interest and penalty paid on license fees qualify as revenue expenditure and allowed a deduction under the Income Tax Act.

The case is regarding the assessment year 2015-16. Bharti Airtel Limited, the appellant had claimed certain expenditures under the head of revenue expenses, mainly interest and penalty related to paying license fees to the Department of Telecommunications (DoT). The Assessing Officer (AO) accepted the claim in the scrutiny assessment under Section 143(3) of the Income Tax Act. The PCIT invoked revisionary powers under Section 263, stating that the AO’s order was erroneous and prejudicial to the interests of the revenue.

ITAT Admits Additional Evidence, Remands Rs. 17 Lakh Unsecured Loan Case to AO for Fresh Assessment

Takhatsinh F. Dodia vs The ACIT CITATION: 2025 TAXSCAN (ITAT) 704

The Surat Bench of the Income Tax Appellate Tribunal (ITAT),  set aside an appeal order and remanded the case back to the Assessing Officer (AO) for fresh assessment, admitting additional evidence related to an unsecured loan of Rs. 17 lakh. Coming to the facts of the case, the assessee, Takhatsinh F. Dodia, a resident of Surat, declared an agricultural income of Rs. 31.25 lakhs in his return for the Assessment Year (AY) 2017-18. But later on, the assessee claimed that it was a clerical error and the correct figure was Rs. 3.12 lakh.

Wrong Clause Selection Not Fatal to Proceedings’: ITAT Grants Fresh Opportunity for 12AA Registration

Sri Sai Sanskar Trust vs CIT (Exemptions) CITATION: 2025 TAXSCAN (ITAT) 705

The  Pune Bench of the Income Tax Appellate Tribunal (ITAT) held that the inadvertent selection of an incorrect clause in an application for registration under Section 12AA of the Income Tax Act, 1961, should not be grounds for outright rejection as it was not fatal to proceedings. In this case, the assessee, Sri Sai Sanskar Trust, had appealed against the denial of registration by the Commissioner of Income Tax (Exemptions).

Natural Justice Prevails: ITAT Grants Assessee Fresh Hearing Opportunity Subject to Rs. 2,000 Cost Payment

Naeemakhtar Faniband vs I T O CITATION: 2025 TAXSCAN (ITAT) 706

The Panaji Bench of the Income Tax Appellate Tribunal (ITAT), upheld the principles of natural justice by providing the assessee with another opportunity to present their case before the Commissioner of Income Tax (Appeals) [CIT(A)], along with the condition that the assessee must pay a cost of Rs. 2,000 to the Income Tax Department within one month from the date of receiving the order and submit proof of payment. 

In this case, the assessee,  Naeemakhtar Faniband, had not filed Income Tax Returns (ITR) for the assessment year (AY) 2015-16. The Assessing Officer (AO) initiated proceedings under Section 147 of the Income Tax Act, 1961, after noticing discrepancies in the market value of a property purchased by the assessee compared to the sale consideration mentioned in the sale deed. The AO issued notices under Sections 148, 143(2), and 142(1) of the Income Tax Act, calling for explanations regarding the sources of investment and cash deposits in the bank account.

Mechanical Approval u/s 153D: ITAT quashes Assessment for Lack of Application of Mind

RAJESH KUMAR GUPTA vs ACIT CITATION: 2025 TAXSCAN (ITAT) 707

The Delhi Bench of Income Tax Appellate Tribunal (ITAT) quashed the assessment, holding that the approval under Section 153D of Income Tax Act,1961 was granted mechanically without due application of mind. Rajesh Kumar Gupta, appellant-assessee, appealed against the assessment order passed on December 13, 2019, under Section 143(3). The Assessing Officer (AO) added Rs. 1,02,00,000 as undisclosed income and Rs. 5,67,68,556 as undisclosed jewelry. The Commissioner of Income Tax(Appeals) [CIT(A)] partly allowed the appeal, leading to the present appeal.

Disallowance of Interest on Loan for Share Acquisition: ITAT Upholds Deduction as Business Expense

Deputy Commissioner of Income Tax vs East India Petroleum Limited CITATION: 2025 TAXSCAN (ITAT) 708

The Hyderabad Bench of Income Tax Appellate Tribunal(ITAT) upheld the deduction of interest on a loan taken for share acquisition, recognizing it as a business expense. The Revenue-appellant appealed against the order passed by Commissioner of Income Tax(Appeals)[CIT(A)] dated  19.08.2024 for the Assessment Year 2018-19. In this case, East India Petroleum Limited,respondent-assessee,provided terminalling services for oil marketing companies at Visakhapatnam Port, Andhra Pradesh. It filed its income tax return on October 30, 2018, for the assessment year 2018-19, declaring an income of ₹31,38,15,690.

Disallowance of Depreciation on Goodwill: ITAT Upholds Claim as Intangible Asset Eligible u/s 32

Deputy Commissioner of Income Tax vs East India Petroleum Limited CITATION: 2025 TAXSCAN (ITAT) 708

The Hyderabad Bench of Income Tax Appellate Tribunal(ITAT) upheld the depreciation claim on goodwill, affirming it as an intangible asset eligible under Section 32 of Income Tax Act,1961. The Revenue-appellant appealed against the order passed by Commissioner of Income Tax(Appeals)[CIT(A dated  19.08.2024 for the Assessment Year 2018-19. In this case,East India Petroleum Limited,respondent-assessee,provided terminalling services for oil marketing companies at Visakhapatnam Port, Andhra Pradesh. It filed its income tax return on October 30, 2018, for the assessment year 2018-19, declaring an income of ₹31,38,15,690.

Reassessment u/s 147 on Mere Change of Opinion Invalid: ITAT

Rahul Bajpai vs The Assistant Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 709

In a recent judgement, the Raipur bench of the Income Tax Appellate Tribunal (ITAT)  held that reassessment cannot be done based on a mere change of opinion under section 147 of the Income Tax, 1961. The assessee, Rahul Bajpai, purchased a property for ₹4,11,000, a value that is significantly lower than its fair market value (FMV) of ₹3.75 crore.

Diamond Cash Sales Duly Recorded in Books: ITAT upholds Deletion of Rs. 1 Cr Addition

The DCIT vs Radhika Diamonds, Vadodara CITATION: 2025 TAXSCAN (ITAT) 710

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) upheld the deletion of a Rs. 1 Crore addition under Section 68 of the Income Tax Act, ruling that the Diamond cash sales were duly recorded in the books of accounts and supported by sufficient evidence. Radhika Diamonds (assessee) engaged in the business of trading and manufacturing of diamond jewelry, loose diamonds and silver wholesale to customers. The assessee filed return of income for the assessment year 2017-18 on declaring a total income of Rs. 65,790.

AO Relied on Bank Account Not Admitted by Taxpayer: ITAT Quashes Rs. 4 Crore Addition

Amitsingh Vrajrajsingh Bhadoriya vs The Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 711

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) quashed an addition of over Rs. 4 crore after observing that the Assessing Officer (AO) had relied on a bank account which was not owned by the assessee. Amitsingh Vrajrajsingh Bhadoriya (assessee) engaged in the business of mattress trading. The AO made an addition of Rs. 4,00,82,154 under Section 69A of the Income Tax Act, 1961. This addition was based on the cash deposits made by the assessee.

ITAT Upholds Additions for Unexplained Cash Credit and Delayed PF Payments, Grants Partial Relief on Foreign Travel Expenses

Shridev Procon Limited vs Deputy Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 712

The Income Tax Appellate Tribunal, Ahmedabad Bench, had delivered a ruling allowing partial deductions for foreign travel expenses claimed by the appellant while disallowing a portion on the grounds of personal use. Shridev Procon Limited, appellant-assessee had challenged the disallowance of travel expenses, an addition under Section 68 of the Income Tax Act, disallowance under Section 36(1)(va) related to provident fund (PF) contributions, and interest expense disallowances. A major point of contention in the appeal was the disallowance of Rs.35.60 lakh in foreign travel expenses incurred for business purposes.

CSR Expenditure Eligible for 80G Deduction: ITAT

ACIT-3(3)(1) vs Sikka Ports and Terminals Ltd. CITATION: 2025 TAXSCAN (ITAT) 713

The tribunal noted that while the amount spent is mandatory, companies can choose where to donate By Adwaid M S - On April 5, 2025 7:25 am - 2 mins read The Income Tax Appellate Tribunal ( ITAT ) Mumbai recently delivered a significant ruling, allowing companies to claim deductions under Section 80G for Corporate Social Responsibility (CSR) expenditures.

The decision came in appeals filed by the Revenue against Sikka Ports and Terminals Ltd. for Assessment Years 2018-19 and 2020-21. Sikka Ports and Terminals Ltd had donated Rs.33.85 crore to Reliance Foundation and Shyam Kothari Foundation. Both are registered under Section 80G. The company claimed a 50% deduction on these donations. Tax officials argued CSR spending is mandatory and not voluntary donations. They said such expenses should not qualify for deductions.

ITAT quashes Assessment over Lack of Independent Verification in S.153D Approval

Mainee Steel Works Pvt. Ltd vs DCIT CITATION: 2025 TAXSCAN (ITAT) 714

The Delhi Bench of Income Tax Appellate Tribunal(ITAT) quashed the assessment against the assessee, holding that the approval granted under Section 153D of Income Tax Act,1961, was mechanical and lacked independent verification. Mainee Steel Works Pvt. Ltd.,appellant-assessee,was engaged in renting construction scaffolding equipment and earning rental income from properties in Noida, Uttar Pradesh. A search and seizure operation was conducted on November 19, 2018, at its premises, leading to notices under Section 153A for multiple assessment years. The assessee filed returns, and assessments for unabated years 2013-14 to 2017-18 were completed under Section 143(3) read with Section 153A of the Act.

Vivad Se Vishwas Scheme 2024 opted by Assessee: ITAT dismisses Appeal as Withdrawn

Priti Mishra vs The Assisstant Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 716

The Allahabad Bench of the Income Tax Appellate Tribunal (ITAT),  dismissed an appeal filed by a resident of Clive Road, Civil Lines, Allahabad, after she opted to settle her tax dispute under the Vivad Se Vishwas Scheme, 2024. The assessee, Priti Mishra, has appealed before the ITAT against the order passed by the Commissioner of Income Tax (Appeals) [CIT(A)] for the assessment year 2017-18, in which the latter upheld the penalty of Rs.  86,774 imposed under Section 270A of the Income Tax Act, 1961.

AO Failed to Consider Rule 6DD Exceptions in Cash Deposit Disallowance: ITAT Remits Case for De Novo Assessment

Joy Thomas vs The Income Tax Officer - Ward -1 CITATION: 2025 TAXSCAN (ITAT) 717

The Cochin bench of the Income Tax Appellate Tribunal (ITAT) remanded the matter back for de novo assessment as the bench observed that the assessing officer (AO) and the Commissioner of Income Tax (Appeals) [CIT(A)] failed to consider the Rule 6DD exceptions in cash deposit disallowance. The assessee has appealed against the order passed by the CIT(A) for the assessment year (AY) 2020-21.

ITAT Deletes Penalty of Rs. 1.5 Lakh u/s 271B for Delayed Tax Audit Due to Managing Partner’s Demise

T.J. Mathai and Company vs The Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 718

The Cochin bench of the Income Tax Appellate Tribunal (ITAT) deleted the penalty of Rs. 1.5 lakhs imposed under Section 271B for delayed tax audit due to the demise of the managing partner. Coming to the facts of the case, the assessee firm did not file its income tax return for assessment year (AY ) 2014-15 under Section 139(1) of the Income Tax Act, 1961. The assessing officer (AO) issued a notice under Section 148 on 30.03.2021, making the firm to file its return on 13.04.2021, declaring a total income of Rs. 37,41,790. The assessment was completed on 24.03.2022 under Section 144 of the Income Tax Act, accepting the declared income but imposing a penalty under Section 271B for the delayed submission of the tax audit report.

Violation of Natural Justice: ITAT Sets Aside CIT(A)’s Ex-Parte Order Passed without Notice to Assessee

Sandha And Associates P Ltd vs Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 720

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT), in a recent ruling has set aside an ex-parte order passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [CIT(A)](NFAC), after finding that the assessee had not been issued any notice before the order was pronounced.

The Tribunal remanded the matter back to the CIT(A) for de novo adjudication, directing that a reasonable opportunity of being heard be granted to the assessee. The case concerns the assessment year 2017–18. The assessee, Sandha and Associates Private Limited, challenged the ex parte order passed by the CIT(A), asserting that the order was passed without any intimation and that no opportunity was provided to present submissions or documents in defence.

AO adds Rs. 30 crore as Unexplained Investment: ITAT restores matter in Interest of Justice with Penalty

M/s. Samarttha Developers vs ITO CITATION: 2025 TAXSCAN (ITAT) 720

The Pune Bench of the Income Tax Appellate Tribunal (ITAT) remanded the matter back to the Assessing Officer (AO) in interest of justice with penalty in a case where an addition of Rs. 30 crore was made as unexplained investment. Samarttha Developers (assessee) is a partnership firm purchased 11 immovable properties for consideration of Rs. 28,62,78,460 made investments amounting to Rs. 30 crore that were not properly explained during the assessment. The AO issued notice to the assessee. The assessee failed to comply with notices and therefore, the AO made an addition of Rs. 30 Crore under section 69 of the Income Tax Act.

Income Tax Addition for Turnover Mismatch Set Aside Due to Lack of Evidence: ITAT Deletes Disallowance under Section 40A(3) as Income was Estimated

Nishant Jain vs The Assistant Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 719

In a recent ruling, the Raipur Bench of the Income Tax Appellate Tribunal (ITAT) partly allowed appeals for multiple assessment years by holding that where income is assessed on an estimated basis, separate disallowances, such as those under Section 40A(3), are not sustainable. The assessee, Nishant Jain, a civil contractor engaged in government infrastructure projects, had filed appeals for Assessment Years (AY) 2014–15, 2017–18, and 2018–19. The additions made by the lower authorities varied for each year and were based on distinct grounds. Regarding AY 2014–15, the Assessing Officer (AO) made an addition of ₹1.36 crore, citing a mismatch between the turnover as reflected in Form 26AS and the assessee’s books of account. According to the AO, the assessee failed to reconcile the discrepancy attributable to mobilization and machinery advances. The CIT(A) upheld the addition, stating that the assessee failed to furnish sufficient evidence showing that the difference had been accounted for in subsequent years.

PCIT Revision Order: ITAT Rules Assessment Order not erroneous, Rules Unexplained Money matter Properly Verified

Chandrakant Vallabhbhai vs The PCIT, Central Circle-1 CITATION: 2025 TAXSCAN (ITAT) 721

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) quashed the revisionary order passed by the Principal Commissioner of Income Tax (PCIT), ruling that the assessment order was not erroneous. Chandrakant Vallabhbhai Koladia (assessee) had filed his return of income for Assessment Year 2018-19 declaring a total income of Rs. 1,23,69,720. Based on the survey findings, the assessee disclosed an additional income of Rs. 55,14,000 in his return.

No Possession, No Taxation: ITAT Deletes Capital Gains Addition u/s 2(47) of Income Tax Act

Sandesh Vasantrao Pawar vs The Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 724

The Pune bench of the Income Tax Appellate Tribunal (ITAT) has remanded a matter back to the Assessing Officer for fresh verification in a case involving alleged capital gains based on a cancelled development agreement. The assessee, Sandesh Vasantrao Pawar, a resident of Satara running a small gift article shop, entered into a Joint Development Agreement (JDA) in 2013, along with seven other co-owners, to develop a piece of land. The agreement was executed with M/s Shri Nath Builders Promoters Pvt. Ltd., whereby the landowners would receive a share in the built-up area instead of transferring development rights. The Assessing Officer later reopened the case under section 147, claiming income had escaped assessment, and issued a notice under section 148.

ITAT Deletes Rs.22.93 Lakh Penalty on Builder, Cites Auditor’s Mistake & Lack of Intent to Evade Tax

Silver Oak Buildcon Private Limited vs ACIT, Circle – 6, Pune CITATION: 2025 TAXSCAN (ITAT) 722

The Income Tax Appellate Tribunal (ITAT), Pune Bench, has cancelled a penalty of Rs.22.93 lakh that was imposed on Silver Oak Buildcon Private Limited, a construction company based in Pune. The penalty was levied under Section 270A of the Income Tax Act for alleged under-reporting of Rs.37 lakh related to unpaid service tax and Rs.11,556 related to delayed Provident Fund payments. The company had disclosed these liabilities in its tax audit report. The ITAT observed that the omission from the income tax return was not an act of concealment or misreporting but a genuine mistake by the tax auditor. All dues were paid later, and the company accepted the tax demand without dispute, indicating no intention to evade tax.

Exemption u/s 11 and 12 for Charitable Trusts Can’t Be Denied on Mere Technical Errors : ITAT

ITO (Exemption Ward) vs Savitribai CITATION: 2025 TAXSCAN (ITAT) 725

In a recent ruling, the Income Tax Appellate Tribunal (ITAT) Pune bench held that the exemption under sections 11 and 12 of the Income Tax Act, 1961, cannot be denied for mere procedural defaults if the assessee meets all substantive conditions. Savitribai Phule Shikshan Prasarak Mandal, a trust running educational institution, claimed exemption of ₹4.85 crore under section 10(23C) of the Income Tax Act, 1961 for the Assessment Year 2019–20.

The tribunal agreed with the CIT(A) that denying the exemption on procedural grounds was unfair and against natural justice. The CPC’s rejection was found to be unjustified.

AO Adds Rs. 5.38 Lakh as Unexplained Cash Deposit: ITAT Confirms Rs. 48,000 Addition as Taxpayer Fails to Prove Source

Shri Balineni Kishore Babu vs Income Tax Officer Ward 14(2) CITATION: 2025 TAXSCAN (ITAT) 730

The Hyderabad Bench of the Income Tax Appellate Tribunal (ITAT) confirmed Rs. 48,000 as assessee failed to prove source of deposits in the case where the Assessing Officer (AO) had made an addition of Rs. 5.38 lakh as unexplained cash deposits. Shri Balineni Kishore Babu (the assessee), a Chartered Accountant by profession, had filed his return of income for AY 2017-18, declaring an income of Rs. 5,22,840. The return was selected for scrutiny under CASS due to high-value cash deposits during the demonetization period.

ITAT Remands Ecoboard Industries’ Appeals for Fresh Decision observing Consultant’s Error and Financial Distress

Ecoboard Industries Ltd vs DCIT, Circle-1(1) CITATION: 2025 TAXSCAN (ITAT) 727

The Pune bench of the Income Tax Appellate Tribunal (ITAT) condoned the delay and remanded the appeals filed by Ecoboard Industries’ observing consultant’s error and financial distress, while stating that rejecting substantive claims on technicalities could compromise the delivery of justice. The assessee, Ecoboard Industries Ltd., is engaged in the manufacturing of particle boards using bagasse (a by-product of sugar processing).

The bench observed that litigants derive no advantage from delayed appeals and that rejecting substantive claims on technicalities could compromise the delivery of justice. The Tribunal thus set aside the case by remanding all matters to the CIT(A) for a fresh decision. It also advised the assessee to remain vigilant and avoid unnecessary adjournments. To Read the full text of the Order CLICK HERE

ITAT quashes Penalty on Depreciation Claim: Section 271(1)(c) Not To be Applied for Honest Mistakes

Sahajanand Medical Technologies vs Deputy Commissioner of Incometax, Circle-2(1)(2) CITATION:   2025 TAXSCAN (ITAT) 728

The Surat bench of the Income Tax Appellate Tribunal (ITAT), in a recent ruling, gave relief to the assessee, setting aside a penalty imposed under Section 271(1)(c) of the Income Tax Act, 1961. This case is on a matter relating to the assessment year 2006–07. The dispute lay in two primary issues: first, the incorrect claim of additional depreciation on machinery; second, the method adopted by the company in depreciating leasehold improvements. During assessment proceedings, it was discovered that the assessee had claimed 20% additional depreciation on plant and machinery purchased in the second half of the financial year, whereas, under the Income Tax provisions, only 10% was allowable if the asset was put to use for less than 180 days. Additionally, the company had amortised leasehold improvements over five years, claiming 20% depreciation instead of the standard 15%.

Cash Deposits during demonetization: ITAT remands matter to consider Evidence

Aryavysya Seva Sangham vs Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 734

The Hyderabad Bench of the Income Tax Appellate Tribunal (ITAT) remanded a matter back to the Commissioner of Income Tax (Appeals) [CIT(A)] to consider evidence in a case involving cash deposits during the demonetization period. Aryavysya Seva Sangham, (assessee) an Association of Persons (AOP), was taken up for scrutiny based on data analytics under “Operation Clean Money.” The Assessing Officer (AO) found that the assessee had made substantial cash deposits amounting to Rs. 40,43,330/- in bank accounts during the demonetization. The assessee did not file return of income and therefore the AO issued notice to file return of income. The assessee failed to furnish return of income and therefore the AO completed the assessment by assessing total income of Rs. 34,66,350 as unexplained money under Section 69A of the Income Tax Act, 1961.

ITAT Sets Aside CIT(A) Order for Violating Rule 46A(3) in Admitting Fresh Evidence without AO’s Examination

ITO vs Rajivgandhi Grameen Bigarsheti Path Sanstha Marydit CITATION: 2025 TAXSCAN (ITAT) 729

In a recent decision, the Pune bench of the Income Tax Appellate Tribunal held that when fresh evidence is admitted at the appellate stage, the Assessing Officer must be given an opportunity to examine it under Rule 46A(3) of the Income Tax Rules, 1962. The assessee, Rajivgandhi Grameen Bigarsheti Path Sanstha Marydit, is a cooperative society engaged in providing credit facilities to its members. For the assessment year 2017-18, it did not file its return of income. The case was selected for scrutiny based on significant cash deposits made during the demonetization period.

ITAT Directs Reconsideration of School’s Tax Exemption Denial, Cites Lack of Proper Hearing

Shaan Education Society vs CIT (Exemption) CITATION: 2025 TAXSCAN (ITAT) 733

The Income Tax Appellate Tribunal (ITAT), Pune Bench, has set aside an order passed by the Commissioner of Income Tax (Exemption), Pune, which had denied tax exemption registration under Section 12AA of the Income Tax Act, 1961. The petitioner, Shaan Education Society, runs Guardian School in Pune and is registered under the Maharashtra Public Trusts Act, 1950. It filed an application on 29 March 2024 in Form 10AB seeking regular registration under clause (iii) of Section 12A(1)(ac) of the Income Tax Act. The trust had previously been granted provisional registration. To verify the genuineness of its activities, the Commissioner issued a notice through the ITBA portal on 24 May 2024, in response to which the trust submitted the required documents and details.

Reassessment without Tangible Material Invalid: ITAT deletes Rs.10 Lakh Cash Credit Addition

M/s. Shroff Properties Pvt. Ltd vs ITO CITATION: 2025 TAXSCAN (ITAT) 736

The Kolkata Bench of the Income Tax Appellate Tribunal (ITAT) deleted an addition of Rs. 10 lakh made under Section 68 of the Income Tax Act, 1961, holding that the reassessment was carried out without any tangible material. M/s. Shroff Properties Pvt. Ltd., (assessee) filed return of income for the Assessment Year 2010-11. The case was reopened under Section 147 based on information received from the Investigation Wing alleging accommodation entries from M/s. Canary Tradecom Pvt. Ltd., which was stated to be a Jama Kharchi company.

ITAT gives Second Chance to Fruit Trader in Rs.28 Lakh Demonetization Case Over Procedural Lapses

Salim Ali Darugar vs ITO.Ward 2(1) CITATION: 2025 TAXSCAN (ITAT) 732

The Income Tax Appellate Tribunal (ITAT), Panaji Bench, has granted relief to a fruit trader by remanding the matter back to the Commissioner of Income Tax (Appeals) [CIT(A)] for fresh adjudication in a case involving cash deposits of Rs.28.01 lakh made during the demonetization period. Salim Ali Darugar, a resident of North Goa and engaged in retail fruit trading, had filed the appeal against the order of the CIT(A) which upheld the addition made under Section 69A of the Income Tax Act. The Assessing Officer had initiated proceedings under Sections 143(2) and 142(1) based on data from the ITBA system indicating significant cash deposits in bank accounts during the financial year 2016–17, particularly in the demonetization window. The assessee had made cash deposits aggregating to Rs.28,01,500(28.01 Lakh).

Relief to Owner of Taj Hotel Group: ITAT Sets Aside Income Tax Reassessment action Initiated

The Indian Hotels Company Limited vs Additional Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 737

In a ruling in favour of the owner of Taj Hotel Group, the Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has set aside a reassessment action initiated under the Income Tax Act, 1961.

According to the assessee, Indian Hotels Company Limited, a scrutiny assessment was carried out for the assessment year in question in accordance with 143(3) of the Income-tax Act, 1961. that four years following the conclusion of the relevant evaluation year, the assessment was revisited. As a result, the Assessee contended that in order for a reopening to be legitimate, the Assessing Officer had to unequivocally assert that the Assessee had not completely and honestly disclosed all relevant information required for its evaluation. But in the notice for reopening, the Assessing Officer neglected to do so.

ITAT sets aside CIT(A) Order, Rules Genuine Delay Explanation Must Be Considered for High-Value Tax Disputes

Vishal Infraglobal Pvt.Ltd. vs The DCIT Gandhinagar Circle Gandhinagar CITATION: 2025 TAXSCAN (ITAT) 741

The Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench “C”, has set aside the orders passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, which had dismissed appeals filed by Vishal Infraglobal Pvt. Ltd. on grounds of delay. The Tribunal held that where plausible and bona fide explanations for delay are provided, such appeals ought to be heard, especially when significant tax additions and penalties are involved. Vishal Infraglobal Pvt. Ltd., a company engaged in executing government contracts, had not filed its return of income for Assessment Year 2018–19. Based on third-party financial data indicating transactions of over Rs.16.15 crore, the Assessing Officer reopened the assessment under Section 147 and completed it ex-parte under Section 144, determining a total income of Rs.3.47 crore. The AO also initiated penalty proceedings under Section 270A and subsequently levied a penalty of Rs.56.38 lakh

ITAT upholds deletion of Cash Addition, Accepts Joint Family Status & Sale Proceeds as Source

The DCIT vs Shri Inderpal Singh CITATION: 2025 TAXSCAN (ITAT) 738

The Income Tax Appellate Tribunal (ITAT), Chandigarh Bench, has dismissed the appeal filed by the Revenue and upheld the order of the Commissioner of Income Tax (Appeals) [CIT(A)] deleting the addition of Rs.1,00,12,500(1 crore) made under Section 69 of the Income Tax Act, 1961. The Tribunal accepted the explanation provided by the assessee regarding the cash found in lockers, recognizing it as part of joint family funds and traced to the sale proceeds of a property owned by a family member.

The respondent, Inderpal Singh, proprietor of Goodwill Elektro Controls, Ludhiana, was subjected to a search and seizure operation on 28 November 2018. During the course of the operation, cash amounting to Rs.1,00,12,500 was found in Locker Nos. 41 and 42 maintained at SBL Sarabha Nagar, Ludhiana, in the names of Inderpal Singh and his wife, Raminder Kaur. The Assessing Officer treated the cash as unexplained and made an addition under Section 69, citing inconsistency in the assessee’s statements and the absence of documentary evidence linking the cash to a legitimate source.

Taxpayer Not Property Owner, Only POA Holder: ITAT Remands Rs. 4.73 Crore LTCG Addition Matter

Shri Thirupathi Rao Naineni vs Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 743

The Hyderabad Bench of the Income Tax Appellate Tribunal (ITAT) remanded a matter involving Long-Term Capital Gain (LTCG) addition of Rs. 4.73 crore after the assessee claimed that he was not the owner of the property sold but merely a General Power of Attorney (GPA) holder. Shri Thirupathi Rao Naineni (assessee) had not filed return of income for the Assessment Year 2017–18. Based on information received the case was reopened by the Assessing Officer (AO) as the assessee had reportedly sold two immovable properties jointly with three co-owners for Rs. 5.94 crore and Rs. 5.89 crore, while the fair market value as per stamp duty valuation was Rs. 9.90 crore and Rs. 9.82 crore respectively.

ITAT quashes CIT(A)’s Ex Parte Penalty Orders Due to Wrong Email Service

Sunita Ashokbhai Sharma vs The I.T.O CITATION: 2025 TAXSCAN (ITAT) 744

In a recent decision, the Rajkot Bench of the Income Tax Appellate Tribunal (ITAT) condoned delay and set aside the Chief Commissioner of Income Tax (Appeals) (CIT(A)) ex parte order in penalty matters after finding that notices were sent to the wrong email. Sunita Ashokbhai Sharma (assessee) faced three separate penalty orders for non-compliance with notices and procedural lapses under Sections 271(1)(b), 271A, and 271F of the Income Tax Act, 1961. These penalties were levied in connection with the assessment proceedings for the year 2015-16.

ITAT Allows Rs. 6.47 Crore Lease Rent Expense as Deduction Citing Lessee’s Right to Claim Depreciation

DCIT-2(3)(1) VS NTT Global Data Centres Cloud Infrastructure India Pvt. Ltd. CITATION: 2025 TAXSCAN (ITAT) 745

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) upheld the order of the Commissioner of Income Tax (Appeals) [CIT(A)], which allowed depreciation as an alternative claim on finance lease rental payments citing Lessee’s right to claim depreciation. The Tribunal, relying on its coordinate bench’s prior ruling and the Karnataka High Court decision in Cisco Systems Capital (India) Pvt. Ltd., ruled that the lease rent of Rs. 6.47 crore is allowable as revenue expenditure.

Capital Gains arising on Mutual Fund Investments of Non Residents not Taxable in India: ITAT

Anushka Sanjay Shah vs ITO CITATION: 2025 TAXSCAN (ITAT) 746

In a landmark ruling, the Mumbai bench of the Income-Tax Appellate Tribunal (ITAT) has held that in view of Article 13 of DTAA between India and Singapore, the Capital Gains arising on mutual fund investments in hand of non residents is not taxable in India. Anushka Sanjay Shah , the assessee against the order of the Income-tax Officer Int. Tax Ward 4(2)(1), Mumbai [“AO”] dated 21.12.2024 passed u/s. 143(3) r.w.s. 144C(13) of the Income-tax Act, 1961 [ “Act”]. It was argued that the DRP erred in endorsing the order of the AO to assess the capital gains on mutual fund units arising from are taxable in India thereby affirming the addition of Rs. 1,35 66,368 made by the AO. The DRP and AO erred in holding that the short term capital gains on capital gain on debt fund of Rs.88,75,230/- and short term capital gain on equity fund of Rs.46,91,140/- under the head income from capital gain is taxable in India and benefits of Article 13(5) under the India -Singapore treaty are not applicable to the assessee.

Cash Deposits during Demonetization: ITAT directs Normal 30 % Tax Rate citing S. 115BBE not Retrospective

Manjulaben Madhubhai Hapani vs The ITO CITATION: 2025 TAXSCAN (ITAT) 750

The Surat Bench of the Income Tax Appellate Tribunal (ITAT) ruled that the higher tax rate introduced under Section 115BBE could not be applied retrospectively in the case involving cash deposit during demonetization. Manjulaben Madhubhai Hapani, (assessee) filed her return of income declaring total income of Rs. 2,38,920 and agricultural income of Rs. 6,92,062. The AO found that the assessee had deposited Rs. 11,43,500 in her bank accounts during the demonetization period.

Cash Deposits During Demonetization from Amul Parlour Sales: ITAT Accepts Source, Deletes Rs. 27.37 Lakh Addition

Rajnikant Vithaldas Patel vs Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 747

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) deleted an addition of Rs. 27,37,800 and ruled that the cash deposits made during the demonetization period were explained as arising from regular cash sales at the assessee’s Amul Parlour. Rajnikant Vithaldas Patel (the assessee), engaged in the business of retail trading in milk and milk products through an Amul Parlour, had deposited cash in his bank account during the demonetization.

ITAT upholds invocation of revisional jurisdiction u/s 263 by PCIT: Twin Conditions of “Error” and “Prejudice to the Interest of Revenue” Satisfied

Starshine Land vs PCIT CITATION: 2025 TAXSCAN (ITAT) 751

The Mumbai bench of Income Tax Appellate Tribunal (ITAT) recently upheld the invocation of revisional jurisdiction under Section 263 of the Income Tax Act, 1961 by the Principal Commissioner of Income Tax (PCIT), on being certain that the requisite twin conditions of “error” and “prejudice to the interest of revenue” had been duly satisfied. The PCIT observed that the Assessing Officer made an error by not making the addition of income accrued to the assessee company on unsold inventories under the head “Income from House Property”. It was further observed that the Assessing Officer failed to make sufficient inquiries without application of mind and passed the reassessment order.

Assessment Issued in Name of Deceased Invalid: ITAT Remands Rs. 18.47 Cr addition for fresh adjudication

Beena Jashwantbhai Patel vs The Assistant Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 749

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) remanded the matter back to the Assessing Officer (AO) for fresh adjudication in a case where an assessment order was issued in the name of a deceased assessee. Beena Jashwantbhai Patel, legal heir of Late Shri Jaswantbhai Ishwarbhai Patel (assessee), had filed an appeal against the ex-parte order passed by the Commissioner of Income Tax (appeals) [CIT(A)] for Assessment Year 2019–20.

AO Fails to Properly Examine Rs. 1.27 Cr Co-operative Society Deposits: ITAT upholds PCIT’s Revision Order

Pavan Prabhudyal Bhadada vs Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 748

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) upheld the revisionary order passed by the Principal Commissioner of Income Tax (PCIT) due to the lack of enquiry by the Assessing Officer (AO) in Rs. 1.27 Cr deposits by Co-operative Society. Pavan Prabhudyal Bhadada (assessee), in search and seizure action on Shri Renuka Mata Multi State Urban Co-operative Society revealed that the assessee had deposited Rs. 1,27,75,311 in an account maintained with the society.

Advances given in Return for an Advantage by the Shareholder is not Dividend u/s 2(22)(e): ITAT

Subhash Chander Oberoi vs ACIT CITATION: 2025 TAXSCAN (ITAT) 752

The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that advances which are in the nature of commercial transactions would not fall under the purview of the “advance” in Section 2(22)(e) of the Income Tax Act, 1961 and shall not be considered as deemed dividend. The assessee, Subhash Chander, is a proprietor of M/s Paros Corp and is a shareholder holding 35% shares in M/s AGIV India Pvt Ltd. which deals in Broadcast system integration with intellectual capabilities and other business interests and facilities. M/s AGIV India Pvt. Ltd. was developing a joint venture project with IND-AGIV Commerce Ltd. and RST Technologies Ltd. and held 72% shares in IND-AGIV Commerce Ltd. and 90% shares in RST Technologies Ltd.

ITAT Allows NDTV’s Business Expense Claims, Quashes Section 14A Disallowance

NDTV Networks Ltd vs DCIT, Circle-18(1) CITATION: 2025 TAXSCAN (ITAT) 753

In a significant relief for NDTV, the Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has partly allowed the company’s appeal for the Assessment Year 2014–15. The Tribunal set aside disallowances related to business expenses and Section 14A, while remanding the issue of directors remuneration back to the Assessing Officer for fresh verification. The appellant, NDTV Networks Ltd., had challenged the order passed by the Commissioner of Income Tax (Appeals)-6, Delhi, dated 28 August 2018, which upheld disallowances made by the Assessing Officer under Sections 37(1) and 14A of the Income Tax Act, 1961.

Failure to Establish Source of Income: ITAT restricts Addition of Income to 25%

Shri Sundarrajan Venkateshkumar vs ITO CITATION: 2025 TAXSCAN (ITAT) 754

The Chennai bench of Income Tax Appellate Tribunal (ITAT) has recently restricted the addition of unestablished income to 25% noting that the assessee failed to establish the source of the said income amounting to ₹13.39 lacs.

The Chennai bench of Income Tax Appellate Tribunal (ITAT) has recently restricted the addition of unestablished income to 25% noting that the assessee failed to establish the source of the said income amounting to ₹13.39 lacs.

GST Collected by Foreign Company not to be Included in Gross Receipts for Computation of Income u/s 44BB: ITAT

Oceaneering International GMBH vs Deputy Commissioner of Income-tax (International Taxation) CITATION: 2025 TAXSCAN (ITAT) 755

The Income Tax Appellate Tribunal ( ITAT ) bench of Mumbai has ruled that the GST (Goods and Services Tax) collected by the foreign company is excluded from Gross Receipts for calculating income under Section 44BB of the Income Tax Act, 1961. The issues raised by the appellant, Oceaneering International GMBH is the inclusion of GST in the computation of presumptive income under Section 44BB of the Income Tax Act. Oceaneering International GMBH, a non-resident company registered in Switzerland, specializes in providing equipment and services for oil and gas drilling operations to companies engaged in exploration activities in India.

ITAT Allows Section 80P Deduction for Kerala University Co-op Society’s Bank Interest Income

The Income Tax Officer vs Kerala Univerity Employees Co-operative Society Ltd CITATION: 2025 TAXSCAN (ITAT) 758

The Income Tax Appellate Tribunal (ITAT) has ruled in favor of the Kerala University Employees Co-operative Society Ltd., granting it a deduction under Section 80P for interest income earned from investments with the District Co-operative Bank, State Bank of India (SBI), and the Treasury. The decision was made in an appeal against the order passed by the National Faceless Appeal Centre (CIT(A)) for the Assessment Year 2020-21. The dispute arose after the Income Tax Officer (ITO) issued an assessment order for the year 2020-21, disallowing the exemption claimed by the co-operative society on interest income earned from these investments. The ITO had denied the deduction, arguing that the income derived from these banks and institutions did not qualify for a deduction under Section 80P, as the society was considered a co-operative bank.

ITAT Sets Aside CIT(A) Order on Kochin Co-op Society’s Cash Deposits, Demands Fresh Review

The Income Tax Officer vs Kochin Co-Operative Society Ltd. CITATION: 2025 TAXSCAN (ITAT) 759

In a recent ruling, the Income Tax Appellate Tribunal (ITAT) has set aside the order passed by the Commissioner of Income Tax (Appeals) [CIT(A)] in the case of Kochin Co-operative Society Ltd. regarding the unexplained cash deposits made by the society. The case pertains to the Assessment Years 2013-14 and 2014-15. The Revenue, represented by the Income Tax Officer, had filed appeals against the CIT(A)’s orders dated 20th July 2023 and 25th July 2023. The appellant contended that the CIT(A) had erred in accepting the explanation provided by the respondent society regarding the source of the cash deposits, which amounted to Rs. 2,39,82,500. The assessing officer had initiated proceedings under Section 148 of the Income Tax Act, suspecting that income had escaped assessment. Subsequently, a best judgment assessment was conducted under Section 144 due to the failure of the society to file a return of income under Section 139(1).

ITAT Remands ₹5.41 Cr TDS Disallowance on US Remittance for Reassessment Under India-US DTAA

Sunku Satyanarayana Sanjay vs The Deputy Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 760

The Income Tax Appellate Tribunal (ITAT) Bengaluru recently set aside a ₹5.41 crore TDS disallowance on payments made to a US-based entity for business development and marketing services and directed it to reassess according to the provisions of India-US Double Taxation Avoidance Agreement (India-US DTAA). Sunku Satyanarayana Sanjay (assessee-appellant) was engaged in the export of software development and testing services through his proprietary concern, Versatiletech.

ITAT Confirms ₹4.10 Cr Addition U/s 69, Upholds Courts’ Authority to Dismiss Defaulted Cases

Sureshbhai Raghubhai Thorat vs The ITO CITATION: 2025 TAXSCAN (ITAT) 761

In a recent judgment, the Income Tax Appellate Tribunal (ITAT) of Surat upheld the addition made by the Assessing Officer (AO) under section 69 of the Income Tax Act, 1961, as the assessee failed to appear and respond despite repeated notices being issued. Sureshbhai Raghubhai Thorat (assessee-appellant) failed to file the income tax return for the Financial Year (FY) 2017-18. Due to this non-compliance, a survey was conducted by the Income Tax Department. During the survey, the authorities discovered a notarized agreement indicating the assessee’s ₹4.10 crore investment in a project.

ITAT Rules in Favor of NSE: Rs 170 Crore SGF Contribution Allowable as Business Expense

National Stock Exchange of India Ltd. vs Principal Commissioner of Income Tax–7 CITATION: 2025 TAXSCAN (ITAT) 757

The Income Tax Appellate Tribunal (ITAT), Mumbai Bench has allowed the appeal filed by National Stock Exchange of India (NSE) against the revisionary order passed by the Principal Commissioner of Income Tax-7 (PCIT) under section 263 of the Income Tax Act, 1961. The appeal pertained to Assessment Year 2015–16 and challenged the disallowance of Rs 170 crore contributed by NSE to the Core Settlement Guarantee Fund (Core SGF) maintained by the National Securities Clearing Corporation Ltd. (NSCCL). The appellant had filed its return of income declaring total income of Rs 968.20 crore, which was assessed at Rs 968.33 crore by the Assessing Officer (AO) under section 143(3) of the Act. Later, the PCIT initiated revisionary proceedings under section 263 on the ground that the AO failed to properly examine the deductibility of the Rs 170 crore contribution to Core SGF, terming it a contingent liability.

No Income Tax Payable on New Flat Received in Exchange for Old One: ITAT deletes Addition u/s 56(2)(x)

Anil Dattaram Pitale vs Income Tax Officer-16(2)(1) CITATION: 2025 TAXSCAN (ITAT) 762

In a recent ruling, The Income Tax Appellate Tribunal ( ITAT ) of Mumbai ruled that income tax is not applicable under Section 56(2)(x) of the Income Tax Act, 1961, where a new flat is received in exchange for an old one as part of a redevelopment project. The bench deleted additions made by the authorities. The assessee, Anil Dattaram Pitale had originally purchased a flat—Flat No. C-5/28 in Mahavir Nagar Tristar Co-operative Housing Society—during the financial year 1997–98. Subsequently, the housing society entered into a redevelopment agreement with a developer. As per the terms of the redevelopment, the assessee surrendered his old flat and received a new flat—Flat No. B-1102—through a registered agreement dated December 26, 2017. The stamp duty value of the new flat was determined to be ₹25,17,700, while the indexed cost of acquisition of the old flat stood at ₹5,43,040.

ITAT Quashes Assessment Order as Notice u/s 143(2) Sent to Wrong Address

Dhanottam Vasant Lonkar vs Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 763

The Income Tax Appellate Tribunal (ITAT) Pune Bench has quashed the assessment order passed against the assessee on the ground that the notice under Section 143(2) of the Income Tax Act, 1961 was issued at an incorrect address and therefore not validly served within the prescribed statutory time limit. The appellant, Dhanottam Vasant Lonkar, had filed his return of income for Assessment Year 2013-14 declaring a total income of Rs.1,76,25,230. His case was selected for scrutiny under CASS, and a notice under Section 143(2) dated 3 September 2014 was issued by the Assessing Officer (AO). The AO claimed that the notice was sent through RPAD to the address “268A, Shivaji Nagar, Pune – 411005.” However, the appellant contended that he never resided at that address and that his correct address, as mentioned in his PAN database and return of income, was “301, Kamala Residency, CTS No.1050, Model Colony, Pune – 411016.” He argued that he had never received the notice under Section 143(2) and that therefore, the assessment proceedings were invalid and void ab initio.

Exempt LTCG under India-Mauritius DTAA cannot be Adjusted against Taxable Losses: ITAT

Bay Capital India Fund Limited vs Additional Director Of Income Tax CITATION: 2025 TAXSCAN (ITAT) 764

Top Stories Exempt LTCG under India-Mauritius DTAA cannot be Adjusted against Taxable Losses: ITAT [Read Order] The Tribunal noted that adjusting taxable losses against exempt gains would result in indirectly taxing exempt income, which would violate the provisions of the DTAA and Section 90(2) of the Act By Adwaid M S - On April 18, 2025 11:09 am - 2 mins read The Income Tax Appellate Tribunal (ITAT) Mumbai Bench has held that long-term capital gains (LTCG) exempt under the India-Mauritius Double Taxation Avoidance Agreement (DTAA) cannot be adjusted against taxable short-term or long-term capital losses incurred by the assessee. The appellant, Bay Capital India Fund Limited, a company incorporated in Mauritius and registered as a Foreign Portfolio Investor with SEBI, filed its return of income for Assessment Year 2019–20 declaring nil income and carried forward capital losses aggregating to Rs.3,59,84,420 (3.59 crore).

ITAT Sets Aside Ex-Parte Orders Passed Without Considering Objections to Mechanical Reopening

Aldiablos Infotech Pvt.Ltd. vs The I.T.O CITATION: 2025 TAXSCAN (ITAT) 767

Top Stories ITAT Sets Aside Ex-Parte Orders Passed Without Considering Objections to Mechanical Reopening [Read Order] The Tribunal observed that non-consideration of objections and passing of non-speaking orders violated the principles of natural justice By Adwaid M S - On April 18, 2025 12:27 pm - 2 mins read The Income Tax Appellate Tribunal (ITAT) Ahmedabad Bench has set aside the ex-parte orders passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, holding that objections raised against mechanical reopening of assessment were not considered and remanded the matters for fresh adjudication.

ITAT Validates AO’s Estimation of Gross Profit at 20.97% for Road Contractor Amidst Unverifiable Cash Transactions

Sarandhar Umashankar Gupta vs Assistant Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 766

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) upheld the rejection of books of accounts of a road contractor, and confirmed the addition of ₹40 lakh on account of unverifiable and inadequately documented cash transactions.  The appeal arose from an order passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), pertaining to Assessment Year (AY) 2017–18. The assessee, Sarandhar Umashankar Gupta, a government contractor engaged in road maintenance work, had challenged the CIT(A)’s decision to uphold the rejection of his books under Section 145A of the Income Tax Act and the resultant addition based on estimated gross profit.

ITAT Dismisses Department’s Appeal, Upholds 5% Bogus Purchase Addition & Deletes Penalty

Income Tax Officer vs Borda Brothers CITATION: 2025 TAXSCAN (ITAT) 768

The Income Tax Appellate Tribunal (ITAT) Surat Bench has dismissed the Department’s appeals, confirming the restriction of bogus purchase addition to 5% and deletion of penalty under Section 271(1)(c) of the Income Tax Act, 1961. The appellant, Borda Brothers, a firm engaged in the diamond trade, had filed its return of income for Assessment Year 2007-08 declaring total income of Rs.43,17,209. The case was reopened under Section 148 based on information from search operations conducted on the Rajendra Jain Group, which was found engaged in providing accommodation entries. The Assessing Officer concluded that Borda Brothers had made bogus purchases from entities linked to the Rajendra Jain Group and made an addition of Rs.9,64,13,991 under Section 69A. In appeal, the Commissioner of Income Tax (Appeals) restricted the addition to 5% of the bogus purchases based on the assessee’s business reality and the consistent approach adopted in earlier years.

ITAT Allows Appeal, Deletes Unexplained Cash Addition of Rs.3.45 Lakh Citing Agricultural Income & Bank Withdrawal Proof

Asifiqbal Ismail Jangda vs Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 770

The Income Tax Appellate Tribunal (ITAT) Surat Bench has deleted an addition of Rs.3,45,000 made towards unexplained cash deposits, accepting the assessee’s explanation supported by agricultural income documents and proof of earlier bank withdrawals. The appellant, Asifiqbal Ismail Jangda, had filed his return of income for Assessment Year 2017-18 declaring Rs.2,71,610. The case was selected for limited scrutiny to verify cash deposits during the demonetisation period amounting to Rs.3,45,000. The Assessing Officer noted that the assessee had deposited Rs.1,45,000 in his HDFC Bank account and Rs.2,00,000 in his Indian Bank account. Since no agricultural income was declared in the return for the year, the Assessing Officer treated the deposits as unexplained under Section 69A of the Income Tax Act and added them to the total income.

ITAT Remands 80P Deduction Case to CIT(A), Directs Fresh Hearing for Co-op Society

Grameena Seva Sahakari Sangha Niyamita vs I T O, National e Assessment Centre CITATION: 2025 TAXSCAN (ITAT) 769

The Income Tax Appellate Tribunal (ITAT) Panaji Bench has set aside the ex-parte order passed by the Commissioner of Income Tax (Appeals) and remanded the matter for fresh adjudication, directing a fresh hearing on the eligibility of deduction claimed under Section 80P by the co-operative society. The appellant, Grameena Seva Sahakari Sangha Niyamita, a cooperative credit society located in Karnataka, filed its return of income for Assessment Year 2014-15, declaring a total income of Rs.97,420 after claiming deduction of Rs.27,55,833 under Section 80P of the Income Tax Act, 1961. The original assessment was completed under Section 143(3) allowing the deduction. Subsequently, the Assessing Officer reopened the assessment under Section 147 on the ground that the assessee was not eligible for deduction under Section 80P and passed the reassessment order denying the claim, assessing the income at Rs.28,53,250.

ITAT Grants Relief in Trust Registration Case Despite Procedural Defaults, Subject to Conditions

Surat Sewa Foundations vs The CIT(Exemption) CITATION: 2025 TAXSCAN (ITAT) 772

In a recent decision, the Surat bench of the Income Tax Appellate Tribunal (ITAT) overturned a decision by the Commissioner of Income Tax (Exemption) ( CIT(E) ) that canceled  the Appellant-Assessee trust’s registration, despite the trust’s delay in submitting the required documents. Surat Sewa Foundations, the assessee trust, has already been provisionally registered under the Income Tax Act of 1961. The trust was then directed to submit the necessary documents to the CIT(E) to prove its genuineness and activities.

ITAT Condones 27-Day Delay and Accepted Trust’s Appeal u/s 80G Following CBDT Circular

Surat Sewa Foundations vs The CIT(Exemption) CITATION: 2025 TAXSCAN (ITAT) 772

In a recent ruling, the Surat Bench of the Income Tax Appellate Tribunal ( ITAT ) condoned a delay of 27 days and allowed reconsideration of a trust’s application for registration under Section 80G of the Income Tax Act, 1961. Surat Sewa Foundation (assessee), a trust formed on 01.12.2021, received provisional registration under Sections 12A and 80G of the Income Tax Act, 1961. It applied for regular registration on 27.10.2023 but failed to respond to notices from  the Commissioner of Income Tax (Exemption) (CIT(E)), leading to rejection of its applications.

ITAT Upholds Penalty Reduction u/s 275(1A) Despite Pending HC Appeal

The DCIT vs Sunit Sudhirbhai Chokshi CITATION: 2025 TAXSCAN (ITAT) 771

In a significant ruling, the Income Tax Appellate Tribunal (ITAT), Ahmedabad, held that Section 275(1A) permits the Assessing Officer (AO) to revise penalties in line with assessment changes directed by appellate authorities or courts even though the appeal is still pending. The assessee, Sunit Sudhirbhai Chokshi, was assessed at ₹23,87,99,020 for the Assessment Year (A.Y.) 2017-18 and 2018-19, based on differences between the returned and assessed income. A penalty of ₹28,088,610 was imposed by the AO under section 271AAB of the Income Tax Act, 1961, on the additions.

Relief for Bank of Baroda: ITAT Rules MAT Provisions u/s 115JB Not Applicable

M/s. Bank of Baroda vs Addl. CIT CITATION: 2025 TAXSCAN (ITAT) 773

The Bangalore Bench of Income Tax Appellate Tribunal ( ITAT )  granted relief to Bank of Baroda by holding that the Minimum Alternate Tax ( MAT ) provisions under Section 115JB of the Income Tax Act,1961 do not apply to it. Bank of Baroda, appellant-assessee, filed its return for AY 2015-16 on 28.9.2015, showing no income. It later revised the return, claiming an additional Rs. 200 crores deduction under section 36(1)(vii), still reporting no income. The case was selected for scrutiny, and notices were issued for verification.

Arvindo Trust Scam Fallout: ITAT Dismisses Appeal Against Disallowance of Bogus Research Donation

Brightech Valves & Controls Pvt. Ltd vs Deputy Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 765

The Income Tax Appellate Tribunal (ITAT) Ahmedabad Bench “SMC” has dismissed the appeal filed against the disallowance of a deduction claimed on a donation made to the Arvindo Institute of Applied Scientific Research, citing that the donation was part of a bogus transaction. The appellant, Brightech Valves & Controls Pvt. Ltd., had filed its return of income for Assessment Year 2012-13 declaring a total income of Rs.28,22,430. The Assessing Officer reopened the assessment after receiving information that Arvindo Institute of Applied Scientific Research was found not to be engaged in genuine research activities. The trustee of the institute, Umesh C. Nagda, during a statement recorded under Section 131 of the Income Tax Act, admitted that the trust was issuing false donation receipts and was not recognized as an approved research institution under Section 35(1)(ii). The appellant had donated Rs.5,00,000 to the said trust and claimed a weighted deduction of Rs.8,75,000 under Section 35(1)(ii), which was disallowed by the Assessing Officer during the reassessment proceedings.

Win for WOW Entertainment: ITAT Deletes ₹1.44 Cr S.68 Addition Over Denial of Cross-Examination and Proven Loan Genuineness

Wow Entertainment and Media Private Limited vs Assistant Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 774

The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) ruled in favor of WOW Entertainment and Media Private Limited, deleting a ₹1.44 crore addition under Section 68 of Income Tax Act,1961 over denial of cross-examination and proven loan genuineness Wow Entertainment and Media Private Limited,appellant-assessee,filed its return of income on 14.03.2019, declaring ₹65,15,970. The case was selected for scrutiny, and notices were issued.During the assessment, the Assessing Officer (AO) found that the company had shown an unsecured loan of ₹1.44 crore (₹1.4 crore as principal and ₹4.67 lakh as interest) from Dhyaneshwari Multistate Urban Cooperative Credit Society Ltd. Several questions were raised regarding the source, purpose, and terms of the loan.

Penalty u/s 270A for Misreporting without Proper Charge Specification Invalid: ITAT Deletes Rs. 38.05 Lakh Penalty

Mr. Nateshan Sampath No.06 vs DCIT CITATION: 2025 TAXSCAN (ITAT) 775

The Bangalore Bench of the Income Tax Appellate Tribunal (ITAT)deleted the penalty of Rs. 38.05 lakh imposed on the assessee due to the failure of the Assessing Officer (AO) to clearly specify the charge whether for under-reporting or misreporting of income. Nateshan Sampath (assessee), had not filed a return of income for Assessment Year 2018–19. The AO issued notice and the assessee filed a return of income declaring loss of Rs. 1,02,80,375 from business and long term capital gains of Rs. 20,68,361 from sale of immovable property.

Religious Objects must be Assessed under 5% Expenditure Rule: ITAT restores 80G Application

Vismruti Social And Charitable Trust vs Commissioner of Income Tax (Exemption) CITATION: 2025 TAXSCAN (ITAT) 778

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) restored the matter for fresh adjudication which is to be assessed at 5% Expenditure rule in a case where the Commissioner of Income Tax (Exemption) [CIT(E)] had rejected the assessee trust’s application for approval under Section 80G of the Income Tax Act, citing the presence of religious objects in the trust deed. Vismruti Social and Charitable Trust (assessee) had applied for registration under Section 80G(5)(iii). The CIT(E) rejected the application on the ground that two of the trust’s objects publishing literature and organizing events related to Sanatan Dharma were religious in nature.

Bogus Purchases of ₹2.5 Crore: ITAT applies 4% GP Rate citing Taxpayer’s Declared Profit

Income-tax Officer vs Mr. Deepak JagshibhaiVisaria CITATION: 2025 TAXSCAN (ITAT) 777

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) upheld the order of the Commissioner of Income Tax (Appeals) [CIT(A)], which restricted the addition on account of bogus purchases to 4% of the purchase value. Deepak Jagshibhai Visaria (assessee) who was alleged to have made bogus purchases which amounted to Rs. 2,50,59,386. The Assessing Officer (AO) based on information received from the Maharashtra Sales Tax Department, treated purchases of ₹2,50,59,386 as bogus and made an addition of ₹31,32,423 by applying a gross profit rate of 12.5%.

CIT(A) grants Relief on Interest Disallowance for Advances to Sister Concerns: ITAT Orders Verification of Funds Flow

Deputy Commissioner of Income Tax vs Oswal Extrusion Ltd CITATION: 2025 TAXSCAN (ITAT) 780

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) directed the CIT(A) to verify the funds flow statement before allowing relief in a case concerning disallowance of interest on advances made to sister concerns. Oswal Extrusion Ltd. ( assessee), advanced Rs. 30 crores to HCP Enterprise Ltd. and Rs. 50 lakhs to Prasthan Infrastructure Ltd., both of which were stated to be its sister concerns. The Assessing Officer (AO) observed that the assessee had incurred interest expenditure of Rs. 933.52 lakhs but had not charged any interest on the advances.

S. 143 Assessment Void Ab Initio: ITAT Rules AO Misapplied Jurisdiction Despite Satisfaction Note u/s 153C

REENA MITTAL vs DCIT CITATION: 2025 TAXSCAN (ITAT) 776

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) quashed the assessment framed under Section 143 of the Income Tax Act, ruling it as void due to misapplied jurisdiction by the Assessing Officer (AO). Reena Mittal, (assessee) in the case where the AO made an addition of Rs. 2,03,03,850. Aggrieved by the AO’s order, the assessee filed an appeal before the CIT(A). The assessee challenged the validity of the assessment order for Assessment Year 2021–22 passed under Section 143(3) of the Income Tax Act.

Failure to Adjudicate AO’s Jurisdictional Grounds: ITAT Remands Matter to CIT(A)

M/s Ashta Vinayak Estate vs Assistant Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 779

The Raipur Bench of the Income Tax Appellate Tribunal (ITAT) remanded the matter to the CIT(A) for fresh adjudication after observing that the CIT(A) failed to address the preliminary jurisdictional objections raised by the assessee against the assessment proceedings. Ashta Vinayak Estate (assessee) is a firm which has filed return of income declaring total income of Rs. 1,22,97,810. The Assessing Officer (AO) issued notices seeking details of sales & purchases of lands and to substantiate short-term capital gain.

ITAT sets aside Addition of Rs. 45.74 Lakh Cash Deposit during Demonetisation, Remands matter for fresh Examination

Trichur Heart Hospital Ltd vs Dy. Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 781

The Cochin Bench of the Income Tax Appellate Tribunal (ITAT), set aside an addition of Rs. 45.74 lakh made by the assessing officer (AO)  on cash deposits in specified bank notes (SBN) during the demonetisation period. The bench has remanded the matter to the Assessing Officer (AO) for fresh examination.  Coming to the facts of the present case, for the assessment year (AY)  2017-18, the hospital assessee named Trichur Heart Hospital Ltd had filed its income tax return declaring an income of Rs. 1.69 crore. After that, the AO completed the assessment at Rs. 2.15 crore, adding Rs. 45.74 lakh as unexplained cash deposits made during demonetisation period. The AO was of the strong opinion that the hospital was not authorised to accept SBN after November 9, 2016. The Commissioner of Income Tax (Appeals) upheld the AO’s decision.

Relief to Oriental Insurance: ITAT Upholds Deletion of Rs. 21.36 Crore Disallowance u/s 14A

ACIT vs The Oriental Insurance Co. Ltd CITATION: 2025 TAXSCAN (ITAT) 782

The Delhi bench of the Income Tax Appellate Tribunal (ITAT) has upheld the deletion of Rs. 21.36 crore disallowance under Section 14A of the Income Tax Act, 1961. In this case, the revenue has appealed against the order of the Commissioner of Income Tax (Appeals) [CIT(A)] for the Assessment Year (AY) 2018-19. The assessee had also filed cross-objections against the order of CIT (A) dated 15.09.2023 for the AY as mentioned earlier.

‘Clear-Cut Case of Concealment’: ITAT Upholds Penalty Under Section 271(1)(c) for Rs 2.65 Crore Bogus Share Capital

UGS Finance Pvt. Ltd vs DCIT CITATION: 2025 TAXSCAN (ITAT) 783

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has upheld a penalty of Rs. 95,10,463 imposed under Section 271(1)(c) of the Income Tax Act, 1961, on the assessee, UGS Finance Pvt. Ltd. for concealing income through bogus share capital transactions amounting to Rs. 2.65 crore by observing that it was a clear-cut case of concealment. For the assessment year 2004-05, the Assessing Officer (AO) reopened proceedings under Section 148 based on information from the Central Economic Intelligence Bureau (CEIB) that the assessee had issued shares at a premium of Rs. 90 per share (face value Rs. 10), but investigations revealed that the transactions were conducted to route unaccounted money.

No Clear Finding on Merits: ITAT Directs CIT(A) to Decide the Matter Afresh

Sudhanshu Rastogi vs ACIT CITATION: 2025 TAXSCAN (ITAT) 784

The Lucknow bench of Income Tax Appellate Tribunal (ITAT) has recently restored a case of an assessee to the file of the Commissioner of Income Tax (Appeals) in the absence of any clear findings on the merits of addition of income. The assessee filed his return of income declaring a total income of  ₹18,03,210 in the status of individual. The case was selected for scrutiny through Computer Assisted Scrutiny Selection (CASS) and a notice was issued to the assessee u/s 143(2) of the Income Tax Act, 1961. In response to the statutory notices, the assessee furnished the requisite information but the information was not found to be satisfactory. Therefore, the cash deposited in the bank account amounting to Rs.43,00,000/- was treated as unexplained income by the Assessing Officer.

“Adequate and Effective Opportunity of Being Heard must be Provided”: ITAT Remands the Case to Assessing Officer

Swastik Enterprises vs ITO CITATION: 2025 TAXSCAN (ITAT) 785

The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) passed an order remanding the case of the assessee to the Assessing Officer (AO) with directions to pass an order after providing effective and adequate opportunity of being heard. The assessee, Swastik Enterprises, is a partnership firm engaged in the business of trading of Iron and Steel scrap from its business places at New Delhi and Gurgaon. The assessee makes purchases majorly from the automobile sector which are then  sold in bulk and retail to scrap melting units and steel manufacturing companies.

Opportunity of Being Heard Must be Provided: ITAT Remits Ex-Parte Order to AO

SOHANVIR SINGH vs ITO CITATION: 2025 TAXSCAN (ITAT) 787

The New Delhi bench of Income Tax Appellate Tribunal (ITAT) has remitted the case of the Assessee back to the file of the Assessing Officer to decide the matter afresh after giving to the assessee an adequate opportunity of being heard. The assessee filed an appeal against the order of Commissioner of Income Tax (Appeals)/ National Faceless Assessment Centre (NFAC), Delhi dated 05.09.2023 relating to assessment year 2017-18.

Approval Memo u/s 153D Silent on Issues Involved not Sustainable in Law: ITAT quashes ₹32L Income Tax Addition

Inder Chand Bajaj vs DCIT CITATION: 2025 TAXSCAN (ITAT) 788

The Delhi bench of Income Tax Appellate Tribunal (ITAT) has quashed an assessment order on the ground of an erroneous and non-speaking approval granted by the Additional Commissioner of Income Tax (Appeals) [CIT(A)] to the Deputy Commissioner of Income Tax under Section 153D of the Income Tax Act, 1961. Assessment proceedings were initiated against the assessee pursuant to a search and seizure operation dated 20.04.2017. Consequently, an assessment order was passed on 18.12.2019 under Section 143(3) read with Section 153A of the Income Tax Act,1961 by making an addition of ₹32,41,00 under Section 68 of the Act,1961.

ITAT disallows Tax Deduction claimed u/s 35(1)(ii)  for Donation to Unapproved Scientific Research Trust

Parag Dave vs The Deputy Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 790

In a recent judgment, the Ahmedabad bench of the Income Tax Appellate Authority (ITAT) set aside the deduction claim of an assessee for the donation made by him to an unapproved scientific authority. The assessee, Parag Dave, was engaged in testing of  soil, building materials, conducting survey work, etc. On 26.09.2017, the assessee filed his return declaring a total income of ₹56,55,070. During the scrutiny assessment, it was observed that he claimed a weighted deduction of ₹54,25,000 under Section 35(1)(ii) of the Income Tax Act, 1961, for a donation of ₹31,00,000 made to Shri Arvindo Institute of Applied Scientific Research Trust.

ITAT rejects Income Tax Department’s Algorithm-Based Tax Addition in Cash Deposit Made During Demonetization Period

Income Tax Officer vs Bimal Jewellers CITATION: 2025 TAXSCAN (ITAT) 789

In a recent ruling, the Delhi bench of the Income Tax Appellate Tribunal (ITAT) upheld the Commissioner of Income Tax (Appeals) [CIT(A)]’s decision to delete the ₹1.63 crore addition made by the Assessing Officer (AO) on cash deposits during the demonetization period, holding that the addition based on algorithmic analysis and speculative assumptions lacked concrete evidence. The assessee, Bimal Jewellers, was engaged in the business of purchasing and selling gold. During the financial year (F.Y.) 2016-17, the assessee deposited ₹2,19,60,000 in cash into two bank accounts maintained with HDFC Bank and Bank of Baroda. Out of this, ₹1,97,00,000 was deposited during the demonetization period.

Cash Deposits Were Duly Recorded in NBFC’s Books: ITAT Deletes Rs. 14.84 Lakh Addition

M/s Savery Transport Finance Limited vs ACIT CITATION: 2025 TAXSCAN (ITAT) 794

The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) deleted the addition of Rs. 14.84 lakhs made under Section 69A of the Income Tax Act, 1961, on the grounds that the cash deposits in question were duly recorded in the books of account maintained by a registered non-banking financial company (NBFC), Savery Transport Finance Ltd. Savery Transport Finance Ltd., the assessee, is a registered NBFC engaged in the business of financing commercial vehicles. For the Assessment Year 2017–18, the assessee filed its return declaring income under the normal provisions and also under the Minimum Alternate Tax (MAT) regime. During the demonetization period from 9 November 2016 to 30 December 2016, the assessee deposited Rs. 15.87 crore in cash, of which Rs. 14.84 lakhs were in Specified Bank Notes (SBNs).

ITAT Sets Aside Rejection of 12A Registration After Finding Trust’s Objects Not Confined to Caste

Patidar Samaj Trust Khajurdi vs Commissioner of Income Tax (Exemption) CITATION: 2025 TAXSCAN (ITAT) 793

The Income Tax Appellate Tribunal (ITAT) Ahmedabad has overturned the rejection of a Trust’s application for registration under Section 12A of the Income Tax Act, 1961, ruling that the trust’s charitable activities were not restricted to a specific caste. The bench, comprising Judicial Member Suchitra Kamble and Accountant Member Narendra Prasad Sinha, directed the Commissioner of Income Tax (Exemption) to reconsider the matter in light of legal precedents. Patidar Samaj Trust Khajurdi had appealed against the CIT (E)’s order which denied its registration under Section 12A, citing that six of its eleven objects primarily benefited the Patidar community. The CIT (E) had invoked Section 13(1)(b) of the Act, which restricts exemptions for trusts serving a particular religious or caste-based group. However, the trust argued that its seventh object explicitly aimed to assist distressed individuals “without caste and creed,” demonstrating a broader charitable intent.

ITAT Clarifies Disallowance u/s 14A of Income Tax is Permissible Even without Exempt Income

Sapphire Foods India Limited vs DCIT CITATION: 2025 TAXSCAN (ITAT) 795

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) upheld the disallowance of expenditure under Section 14A of the Income Tax Act, 1961, clarifying that disallowance is permissible even in the absence of exempt income from Assessment Year 2022–23 onwards, following the amendment introduced by the Finance Act, 2022. Sapphire Foods India Ltd., the assessee, is a prominent operator of KFC and Pizza Hut restaurant chains in India. For the Assessment Year 2022–23, the assessee filed a revised return of income declaring NIL income.

ITAT Ahmedabad Orders Rectification After Wrong Consideration of Depreciation as Net Profit

M/s. Gujarat State Aviation Infrastructure Company Limited vs The Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 792

The Income Tax Appellate Tribunal (ITAT) Ahmedabad has directed rectification after finding that depreciation was wrongly considered as net profit in the intimation issued under Section 143(1) of the Income Tax Act for the Assessment Year 2017–18. The appellant, Gujarat State Aviation Infrastructure Company Limited, challenged the order passed by the Commissioner of Income Tax (Appeal)-National Faceless Appeal Centre, Delhi. The assessee argued that the net profit of Rs.1,44,77,479 (1.44 crore) was mistakenly taken instead of the nil profit reflected in the books of accounts, as per item 45 of Part A of the Profit and Loss Statement in the ITR Form-6.

AO Provided Only 6 Days to Reply to Notice Instead of Mandatory 7 u/s 148A(b): ITAT Quashes Reassessment

Satish Kumar Agrawal vs The Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 796

The Raipur Bench of the Income Tax Appellate Tribunal (ITAT) quashed the reassessment proceedings due to the Assessing Officer (AO) violating the mandatory statutory timeline prescribed under Section 148A(b) by allowing only six days instead of the minimum required seven for filing a reply. Satish Kumar Agrawal, the assessee, filed his return of income for Assessment Year 2018–19, declaring a total income of Rs. 11,42,800. The case was reopened based on information gathered during survey operations conducted in the cases of Pratyush Steels and M/s Abhishek Enterprises.

ITAT Partly Sets Aside Order u/s 263 for Improper Mandatory Direction to Add Accommodation Entries

Sunil Poonamchand Saraf vs The Principal Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 791

The Income Tax Appellate Tribunal ( ITAT ) Ahmedabad has partly set aside an order passed under Section 263 of the Income Tax Act, 1961, where the Principal Commissioner of Income Tax ( PCIT ) improperly directed mandatory addition of accommodation entries without due verification. The appellant, Sunil Poonamchand Saraf, had filed an appeal against the order passed by the PCIT, Ahmedabad-1 for the Assessment Year 2013-14. The appellant had originally filed his return declaring an income of Rs.1,99,610, which was accepted in an assessment under Section 147 read with Section 144B. Subsequently, the PCIT observed that the assessee was identified as an end beneficiary of accommodation entries amounting to Rs.4,07,97,829 (Rs. 4.07 crore) from Dishman Group. Finding that no addition was made during reassessment despite recorded reasons and evidences from search and seizure action, the PCIT issued a notice under Section 263, setting aside the assessment and directing the Assessing Officer to make an addition of the alleged accommodation entries.

Assessment Order Served via Email Landed in Spam Folder: ITAT Condones 191-Day Delay in Filing Appeal

Sarika Dadaso Zende vs ITO CITATION: 2025 TAXSCAN (ITAT) 797

The Pune Bench of the Income Tax Appellate Tribunal (ITAT) condoned a delay of 191 days in filing the appeal before the Commissioner of Income Tax (Appeals) [CIT(A)] after noting that the assessment order had been served via email and had landed in the assessee’s spam folder, resulting in the delay. Sarika Dadaso Zende, the assessee, is engaged in the business of providing manpower services and trading in housekeeping materials. She filed her return of income declaring Rs. 39.96 lakhs and later revised it to Rs. 15.70 lakhs for the Assessment Year 2020–21. The return was selected for scrutiny, and during assessment, the assessee claimed a deduction for service tax and interest totaling Rs. 26.32 lakhs under Section 43B of the Income Tax Act, 1961.

Steel Scrap or Tax Trap? ITAT Slams PCIT’s Overreach in Ahmedabad Bizman’s Case

Vivaa Tradecom Pvt. Ltd. vs Principal Commissioner of Income-tax-4 CITATION: 2025 TAXSCAN (ITAT) 804

The Income Tax Appellate Tribunal (ITAT), Ahmedabad, overturned a revision order by the Principal Commissioner of Income Tax (PCIT) against Vivaa Tradecom Pvt. Ltd., ruling that the tax authority overstepped its powers under Section 263 of the Income Tax Act, 1961. The case involved alleged bogus transactions in steel scrap trading during the 2015-16 assessment year. Vivaa Tradecom Pvt. Ltd., an Ahmedabad-based company, had declared a loss of Rs.89.92 lakh in its original return. The Assessing Officer (AO) disallowed Rs.3.47 lakh of claimed losses on steel scrap sales to Yug Tradelink Pvt. Ltd., citing an investigation report that questioned the buyer’s genuineness. However, the PCIT later deemed the AO’s inquiry inadequate and directed a re-examination of all purchase and sales entries, potentially treating them as unexplained cash credits.

ITAT Sets Aside CIT(A) Direction on TDS Recalculation, Says Original Demand Already Nullified

Emaar India Limited vs DCIT CITATION: 2025 TAXSCAN (ITAT) 803

The Income Tax Appellate Tribunal ( ITAT ) Delhi Bench has set aside an order by the Commissioner of Income Tax (Appeals) [CIT(A)] that directed the Assessing Officer (AO) to recalculate the Tax Deducted at Source (TDS) demand under Section 194C of the Income Tax Act, 1961. The ITAT ruled that the original demand had already been nullified by the Delhi High Court, making the CIT(A)’s directions untenable. The case involved Emaar India Limited, which had appealed against an order passed by the AO under Sections 201(1) and 201(1A) of the Income Tax Act. The AO had treated the company as an “assessee in default” for not deducting TDS under Section 194A on payments made as External Development Charges (EDC) to the Director of Town and Country Planning (DTCP) through the Haryana Urban Development Authority (HUDA). The demand raised was Rs. 25,09,55,212, including interest. Emaar India challenged this order before both the CIT(A) and the Delhi High Court.

Cera Sanitaryware wins on Section 14A issue; improper invocation of Rule 8D leads to deletion of Rs.4.70 lakh disallowance

Cera Sanitaryware Ltd vs The DCIT CITATION: 2025 TAXSCAN (ITAT) 802

The Income Tax Appellate Tribunal (ITAT) Ahmedabad Bench has ruled in favor of Cera Sanitaryware Limited, deleting a disallowance of Rs.4,70,331 made under Section 14A of the Income Tax Act, 1961, read with Rule 8D of the Income Tax Rules, 1962. The tribunal held that the Assessing Officer (AO) improperly invoked Rule 8D without recording valid dissatisfaction with the assessee’s suo moto disallowance of expenses related to exempt income. Cera Sanitaryware had earned exempt income of Rs.22,44,171 during the assessment year 2020-21 and voluntarily disallowed Rs.3,69,059 as expenses attributable to such income. The AO, however, rejected this computation and applied Rule 8D, calculating a higher disallowance of Rs.8,39,390. After adjusting for the assessee’s suo moto disallowance, an additional Rs.4,70,331 was added to taxable income. The Commissioner of Income Tax (Appeals) [CIT(A)] upheld the AO’s decision, prompting the company to appeal before the ITAT.

Reassessment Without Proper Consideration of Evidence: ITAT Restores Rs.15.88 Lakh Addition for Fresh Verification

Amit Hasmukhbhai Shah vs Income Tax Officer CITATION: 2025 TAXSCAN (ITAT) 800

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT) restored a reassessment case to the Assessing Officer (AO) observing that the AO failed to properly consider the documentary evidence furnished by the assessee in relation to cash deposits amounting to Rs. 15.88 lakh. Amit Hasmukhbhai Shah (assessee), whose case was reopened due to the cash deposit of Rs. 15.88 lakh. The AO sought the assessee to explain the source of cash deposit. The assessee replied that the  deposit was made from the loan from farmers, friends and relatives.

VAT Liability Not Disallowable u/s 43B If Not Claimed As Deduction In Profit & Loss Account: ITAT

Dy. Commissioner of Income Tax-1(1) vs Grand Motors CITATION: 2025 TAXSCAN (ITAT) 801

In a significant ruling, the Raipur Bench of the Income Tax Appellate Tribunal (ITAT) has held that unpaid VAT liability cannot be disallowed under Section 43B of the Income Tax Act, 1961 if it has not been claimed as a deduction in the profit and loss account. The decision was rendered in the appeal filed by the Dy. Commissioner of Income Tax-1(1), Raipur against Grand Motors, Raipur, for the Assessment Year 2017-18.

ITAT Quashes Tax Assessment Against Non-Existent Entity, Cites Invalid Jurisdiction

Man Diesel and Turbo India vs The ACIT CITATION: 2025 TAXSCAN (ITAT) 805

The Income Tax Appellate Tribunal ( ITAT ), Ahmedabad, has nullified a tax assessment order framed against Man Diesel and Turbo India Pvt. Ltd. (formerly Man Turbo India Pvt. Ltd.), ruling that the assessment was invalid as it targeted a non-existent entity due to a corporate amalgamation. The bench quashed the proceedings, citing the Supreme Court’s precedent in PCIT vs. Maruti Suzuki India Ltd. (2019). Man Diesel and Turbo India Pvt. Ltd., the successor entity of Man Turbo India Pvt. Ltd. (MTIPL), challenged the assessment order for AY 2013–14, arguing that the Assessing Officer (AO) had issued notices and framed the assessment in the name of MTIPL despite being informed of its amalgamation effective January 1, 2013. The company had formally notified the AO of the merger on June 24, 2014, yet the AO proceeded with scrutiny in MTIPL’s name, culminating in an order dated November 9, 2016.

Presence of Incriminating Material on Record: ITAT Upholds Income Tax Proceedings U/s 153A

Suryavanshi Ventura Pvt. Ltd vs ACIT CITATION: 2025 TAXSCAN (ITAT) 807

The New Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) has upheld the initiation of income tax proceedings u/s 153A of the Income Tax Act, 1961 in view of presence of incriminating material and information on record.

Search had taken place in the premises of the assessee on 22.01.2018 pursuant to which certain incriminating materials were seized and a notice u/s 153A was issued to the assessee. The assessee challenged the issuance of the said notice on the reasoning that no incriminating material was seized from the assessee’s premises and therefore initiation of proceedings u/s 153A was not valid in the eyes of law.

No Income Tax Assessment Beyond 10-year limit u/s153A: ITAT favours Assessee

Suryavanshi Ventura Pvt. Ltd vs ACIT CITATION: 2025 TAXSCAN (ITAT) 807

The New Delhi bench of Income Tax Appellate Tribunal (ITAT) has recently quashed an assessment order passed by the Assessing Officer holding that the assessment year was beyond the ten-year outer ceiling limit prescribed by Section 153A of the Income Tax Act,1961. The assessee challenged the assumption of jurisdiction by the Assessing Officer and consequent passing of the Assessment Order. Counsels appearing for the assessee, Ved Jain, Aman Garg and Ishika Dua, challenged the issuance of notice u/s 153A of the Act,1961 for the assessment year 2008-09 on the reasoning that the said notice was issued beyond the period of limitation. Hence, it was contended that the same was illegal and invalid in the eyes of law.

AO Estimates Profit without Rejecting Books, Relies on Faulty Comparison with Sister Concern: ITAT deletes ₹5.82 Crore Addition

ITO vs Ambience Developments CITATION: 2025 TAXSCAN (ITAT) 810

The Pune Bench of the Income Tax Appellate Tribunal (ITAT) deleted the addition of Rs. 5.82 crore, holding that the Assessing Officer (AO) failed to reject the developer’s books of accounts and relied on improper comparisons with a sister concern. Ambience Developments, the assessee, a partnership firm engaged in real estate development, had declared nil income for the Assessment Year 2013-14. The project in question, named ‘Ambience Greendale’, was under scrutiny where the AO questioned the low profitability declared by the firm compared to another project, ‘Ambience Antilla’, carried out by its sister concern.

CA Led Trust Fails to Respond to Notices; ITAT Grants Final Chance and Imposes ₹2,500 Penalty

Avishkar Shikshan Sanstha VS CIT (Exemption) CITATION: 2025 TAXSCAN (ITAT) 811

The  Income Tax Appellate Tribunal (ITAT), Pune bench imposed a fine of ₹2,500 on a trust led by a Chartered Accountant (CA) for failing to respond to multiple notices regarding the registration of a trust. Despite being given a final chance to submit the necessary documents for trust registration, the delay in compliance resulted in a penalty. Avishkar Shikshan Sanstha, the assessee, applied for the registration of a trust in Form 10AB under section 12A(1)(ac)(iii) of the Income Tax Act, 1961.

ITAT Condones 450-Day Delay in Income Tax Appeal Filing Due to Former CA’s Oversight

Redstone Textile Private Limited vs Asst. CIT, Central Circle 5(4) CITATION: 2025 TAXSCAN (ITAT) 812

The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) condoned  a delay of 450 days in filing an appeal, attributing it to the negligence of the former Chartered Accountant (CA) in failing to inform the assessee. Redstone Textile Pvt. Ltd., the assessee, was engaged in the textile business and was subjected to proceedings under Section 153C of the Income Tax Act 1961. These proceedings were initiated based on a search and seizure conducted on 17 January 2018 in the case of the Deesan Group. During the course of the search, certain documents relating to the assessee were found at the premises of Deesan Texfab Pvt. Ltd.

CIT(E) Rejected 12AB Registration by Relying on S.13(1)(b): ITAT Restores 12AB Registration Application for fresh adjudication

Shree Nishkalank Mahadev vs Commissioner of Income Tax CITATION: 2025 TAXSCAN (ITAT) 814

The Ahmedabad Bench of the Income Tax Appellate Tribunal ( ITAT ) restored the matter to the Commissioner of Income Tax (Exemption) [CIT(E)] for fresh adjudication after ruling that the rejection of 12AB registration by invoking Section 13(1)(b) only at the time of assessment and not at time of grant of registration.  Shree Nishkalank Mahadev Koliyak (assessee), a trust engaged in religious and charitable activities, had filed an application seeking registration under Section 12AB of the Income Tax Act, 1961.

ITAT Grants S. 80-IB(10) Deduction for Timely Completed Wings, Holds Remaining Wing to Be Separate Project

Aakash Nidhi Builders & Developers vs ITO – 25(2)(1) CITATION: 2025 TAXSCAN (ITAT) 813

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has allowed deduction under section 80-IB(10) of the Income Tax Act, 1961, for profits derived from Wings A to F of a housing project completed within the prescribed time limit and held that the additional Wing-G, which was completed later, constitutes a separate project and is not eligible for deduction under the same section. Aakash Nidhi Builders & Developers (assessee), a partnership firm engaged in real estate development, had undertaken a housing project named Aakash Nidhi. The assessee claimed deduction under section 80-IB(10) amounting to Rs. 2,51,07,390 on the entire profit of the project comprising Wings A to G.

Allotments to Relatives Disputed: ITAT Remands Section 80-IB(10) Deduction Claim for Verification

Aakash Nidhi Builders & Developers vs ITO – 25(2)(1)  CITATION: 2025 TAXSCAN (ITAT) 813

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) remanded a matter involving a claim for deduction under Section 80-IB(10) of the Income Tax Act, 1961, for verification of alleged allotments of residential units to relatives of existing flat owners, in possible violation of statutory conditions. Aakash Nidhi Builders & Developers (assessee), a partnership firm engaged in real estate development, claimed full deduction under Section 80-IB(10) for profits derived from a housing project named Aakash Nidhi.

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