ITAT Weekly Round-up

This weekly round-up encapsulates the key stories related to the Income Tax Appellate Tribunal

(ITAT) reported at Taxscan, from March 22, 2026 to March 28, 2026.

Addition on Share Capital Unsustainable In Absence Of Incriminating Material: ITAT Deletes ₹9.99 Cr Addition u/s 68

DCIT vs Whitelotus Solar PrivateLimited

CITATION : 2026 TAXSCAN (ITAT) 314

The IncomeTax Appellate Tribunal Chennai Bench, has held that no addition can be made under Section 68 of the Income Tax Act 1961 in the absence of incriminating material found during search proceedings. The Tribunal upheld the deletion of an addition of ₹9.99 crores made towards preference share capital.

The bench observed that in case of unabated assessment additions under S. 153A can only be made on the basis of incriminating material found during search.

Ignorance of Law & Accountant’s Failure Constitutes Sufficient Cause for Delay: ITAT criticises Hypertechnical Approach by CIT(A)

Mahesh Prakash Bende vs ITOCircle - 27(2)

CITATION : 2026 TAXSCAN (ITAT) 315

The Income Tax Appellate Tribunal ( ITAT ), Mumbai, while condoning delay of 127 days, said that lack of legal awareness and professional negligence by an accountant can constitute "sufficient cause" for a delay in filing an appeal. The appellate bench criticised the CIT(A) for taking a hyper-technical approach.

The ITAT set aside the order of the CIT(A), condoned the delay, and remanded the matter back for fresh adjudication after providing adequate opportunity of hearing to the assessee.

Invocation of S. 263 Not Permissible where ITR filed u/s 44AD: ITAT holds S. 68 Inapplicable without Books

Neeraj vs Principal Commissionerof Income Tax

CITATION : 2026 TAXSCAN (ITAT) 316

The Income Tax Appellate Tribunal (ITAT),Delhi Bench, held that invocation of revisionary jurisdiction under section 263 of the Income Tax Act, 1961, is not permissible where the assessee has filed return of income under Section 44AD. The Tribunal clarified that in the absence of books of accounts, Section 68 relating to unexplained cash credits cannot be applied.

In light of facts and circumstances, the Tribunal quashed the order passed under section 263 of Income Tax Act.

No Need to Re-examine Section 10 Exemption Claim from Income Tax if Opportunity of being Heard not Provided: ITAT Decides in Rs.112 Cr Matter

Hamdard Laboratories India vsDCIT

CITATION : 2026 TAXSCAN (ITAT) 317

The Income Tax Appellate Tribunal (ITAT), New Delhi Bench, heard a INR 112 crore matter wherein it was held that there is no need to re-examine exemption from income tax claim if opportunity of being heard is not provided.

The ITAT bench also found merit in the argument that there is no case of issuance of directions. Madhumita Roy (Judicial Member) and Ambitabh Shukla (Accountant Member) accordingly quashed the order dated 27.10.2025 under Section 250 passed by CIT(A), Madurai. The grounds, and the appeal itself was therefore allowed.

GST Not Includible in Presumptive Income u/s 44B: ITAT Deletes Addition on Shipping Company

Orient Overseas Container LineLimited vs Deputy Commissioner of Income Tax

CITATION : 2026 TAXSCAN (ITAT) 318

The Income Tax Appellate Tribunal (ITAT) Bench Mumbai has held that the Goods and Services Tax (GST) collected by a non resident shipping company cannot be added to the gross receipts for the purpose of determining presumptive income under Section 44B of the Income Tax Act, 1961. The Tribunal accordingly deleted the addition of ₹8.34 crore made by the Assessing Officer.

The Tribunal pointed out that section 44B is a special provision with a non-obstante clause and the computation of the amount is strictly in respect of the amount relating to the carriage of goods or passengers. The tribunal also held that it cannot include GST as it would amount to tax on tax and cannot be allowed as well as the decisions in respect of exclusion of service tax are applicable to GST as well.

Identity, Genuineness and Creditworthiness of Investors and Relatives for S. 68 Already Examined: ITAT Rejects Dept's Appeal

ITO, DELHI vs GOVERDHANTRANSPORT COMPANY PVT. LTD

CITATION : 2026 TAXSCAN (ITAT) 319

The Income Tax Appellate Tribunal (ITAT), New Delhi Bench, held that the identity, genuineness and creditworthiness of investors and relatives has already been examined and therefore rejected the appeal filed by the Income Tax Department.

The bench of S. Rifaur Rahman (Accountant Member) and Sudhir Kumar (Judicial Member) hence found no infirmity with the order of the CIT(A) and upheld the same, dismissing the appeal filed by the Revenue.

Unexplained Cash Deposit of Rs. 1.2cr made During Demonetisation: ITAT Reduces Addition Drastically, Retains Lump Sum ₹8 Lakh

ITO vs M/s Retro FootwearPrivate Limited

CITATION : 2026 TAXSCAN (ITAT) 321

The Income Tax Appellate Tribunal (ITAT), New Delhi Bench, heard a matter wherein the subject was the unexplained cash deposit of INR 1.2 crore during the demonetisation period. The ITAT reduced the addition drastically but retained a lump sum amount of INR 8 lakhs.

The bench of Satbeer Singh Godara (Judicial Member) and Amitabh Shukla (Accountant Member) thus partly allowed the appeal of the Revenue.

Mode of Payment for Purchase of Shares as Long Term Capital Gain Different in Lower Authorities Proceedings: ITAT Restores File for Fresh Verification

Vijay Kothari vs DCIT(Central)-1 Indore

CITATION : 2026 TAXSCAN (ITAT) 322

The Income Tax Appellate Tribunal (ITAT), Indore Bench, noted the mode of payment for the purchase of shares as long term capital gain in the proceedings in the lower authorities and the present matter were different and restored the filed back to the Assessing Officer (AO) for fresh verification.

The bench of Paresh M. Joshi (Judicial Member) and B.M. Biyani (Accountant Member) directed that the issues are to be verified by the AO on a fresh and factual level.

AO Cannot Issue Consolidated Satisfaction Note for Multiple Assessment Years: ITAT Allows Appeal noting Exceeded Jurisdiction

Parveen Garg vs DeputyCommissioner of Income Tax

CITATION : 2026 TAXSCAN (ITAT) 323

The Income Tax Appellate Tribunal (ITAT), New Delhi Bench, allowed an appeal wherein the recorded satisfaction note showed invalid jurisdiction of the Assessing Officer (AO).

Accordingly, the bench of Renu Jauhri (Accountant Member) and Yogesh Kumar U.S. (Judicial Member) allowed the appeal on this ground and quashed the assessment order.

Association of Person’s Income of Rs. 1.4L Not Taxable at Maximum Marginal Rate u/s 167B: ITAT

M/s Gulmohar Park Journalists’Colony Welfare Association vs Income Tax Officer

CITATION : 2026 TAXSCAN (ITAT) 324

The Income Tax Appellate Tribunal (ITAT), Delhi Bench, held that income of ₹1,45,720 earned by an Association of Persons (AOP) cannot be subjected to tax at the maximum marginal rate (MMR) and held that the section 167B of the Income Tax Act, 1961 were not applicable.

The Tribunal set aside the order and directed the Assessing Officer to recompute the tax liability without applying MMR. In light of facts and circumstances the appeal of the appellant was allowed.

No Capital Gain on Sale of Agricultural Land Beyond Prescribed Municipal Limits u/s 1(14): ITAT Dismisses Appeal of Revenue Dept

The ACIT vs Ahmed Mahomed Pandor

CITATION : 2026 TAXSCAN (ITAT) 325

The Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench, upheld the deletion of addition towards long-term capital gains (LTCG), holding that agricultural land does not lose its character merely because it was subsequently used for industrial purposes by the purchaser.

The Tribunal Relied on the decision of the Gujarat High Court in CIT v. Rajshibhai Meramanbhai Odedra, and reiterated that sale of agricultural land to a non-agriculturist or its later use for non-agricultural purposes does not change its character for tax purposes.

ITAT Upholds Deletion of Protective Additions u/s 68 Where Substantive Addition Made in Absence of Beneficial Ownership

ACIT vs M/s. Ambarnuj Financeand Investments Pvt Ltd.

CITATION : 2026 TAXSCAN (ITAT) 326

The Income Tax Appellate Tribunal (ITAT),Delhi Bench, has upheld the deletion of the protective additions made under Section 68 of the Income Tax Act, 1961, on the grounds of the lack of established beneficial ownership and the presence of substantive additions on the same issue in the hands of another entity.

The Bench comprising Satbeer Singh Godara (Judicial Member) and Manish Agarwal (Accountant Member) has rejected the appeals filed by the Revenue and has upheld the order passed by the Commissioner of Income Tax (Appeals) [CIT(A)] on the grounds that the protective additions made under Section 68 of the IT Act, 1961, cannot be sustained when the substantive additions on the same issue are already made in the hands of another entity, and the ownership of the assessee on the credits has not been established.

ITAT Upholds Deletion of Protective Additions u/s 68 Where Substantive Addition Made in Absence of Beneficial Ownership

ACIT vs M/s. Ambarnuj Financeand Investments Pvt Ltd.

CITATION : 2026 TAXSCAN (ITAT) 326

The Income Tax Appellate Tribunal (ITAT),Delhi Bench, has upheld the deletion of the protective additions made under Section 68 of the Income Tax Act, 1961, on the grounds of the lack of established beneficial ownership and the presence of substantive additions on the same issue in the hands of another entity.

The Bench comprising Satbeer Singh Godara (Judicial Member) and Manish Agarwal (Accountant Member) has rejected the appeals filed by the Revenue and has upheld the order passed by the Commissioner of Income Tax (Appeals) [CIT(A)] on the grounds that the protective additions made under Section 68 of the IT Act, 1961, cannot be sustained when the substantive additions on the same issue are already made in the hands of another entity, and the ownership of the assessee on the credits has not been established.

Cash Deposits from Farmers’ Loan Transactions Not Recorded in Books of Account Not Taxable u/s 68: ITAT Upholds Deletion of ₹2.49 Cr Addition

ITO, Ward-1 vs Surekha AshokMukkawa

CITATION : 2026 TAXSCAN (ITAT) 327

The Income Tax Appellate Tribunal (ITAT) Nagpur Bench upheld the deletion of addition for ₹2.49 crore made under Section 68 observing that cash deposits made through a bank account and not appearing in the books of account cannot be treated as unexplained income.

The Bench held that the CIT(A) has validly exercised his powers in admitting additional evidence in view of the exceptional circumstances prevailing during the Covid-19 pandemic and verified the transactions on a test-check basis as a result, the appeal of the Revenue is dismissed.

DTAA Relief Granted on Technical Handling, Interest & Commission Income: ITAT Upholds Addition On Account of Collection Charges

Assistant Commissioner IncomeTax vs AIR France

CITATION : 2026 TAXSCAN (ITAT) 328

The Income Tax Appellate Tribunal (ITAT) Delhi Bench held that the technical handling income, interest income, and commission income earned by the foreign airline are not taxable in India under the India-France DTAA. However, the Tribunal has upheld the addition of income on account of the collection charges, which has been held to be taxable income.

With regard to the collection charges received for the timely remittance of the Passenger Service Fee (PSF) and User Development Fee (UDF), the Tribunal was of the view that the receipts were in the nature of incentives or discounts, and they do not have any nexus with the main business of running the aircraft on international traffic. Thus, the same were held to be assessable.

Interest Received By Cooperative Banks From Fixed Deposit Receipts Are Deductible u/s 80P of Income Tax Act: ITAT

DEOBAND COOPERATIVE CANEDEVELOPMENT UNION LTD. vs AO, NFAC, DELHI

CITATION : 2026 TAXSCAN (ITAT) 329

The Income Tax Appellate Tribunal (ITAT), Delhi Bench, held that interest income earned by a cooperative society from investments in fixed deposits with cooperative banks is eligible for deduction under section 80P of the Income Tax Act, 1961.

The Tribunal relied on the decision of the Co-ordinate bench of Pune Tribunal in case of ITO v. Shri Bhairavnath Multistate Cooperative Credit Society Ltd. and held that interest earned on surplus funds deposited with cooperative banks qualifies for deduction under section 80P(2)(a)(i) and section 80P(2)(d) of Income Tax Act.

Accommodation Entry Loan Held as Unexplained Credit: ITAT Upholds Addition with Interest Disallowance

Bajaj International Realty Pvt.Ltd vs Commissioner of Incometax

CITATION : 2026 TAXSCAN (ITAT) 330

The Income Tax Appellate Tribunal (ITAT) Mumbai Bench upheld the income tax addition on account of an accommodation entry loan opining that it constituted an unexplained credit.

The tribunal upheld the addition of ₹20.52 lakh, confirmed the addition of commission and sustained the disallowance of interest.

Interest Disallowance Unsustainable where Own Funds Adequate: ITAT Upholds Addition u/s 14A

Bombay Minerals Ltd. vs DCIT,Central Circle 3(3)

CITATION : 2026 TAXSCAN (ITAT) 331

TheIncome Tax Appellate Tribunal (ITAT) Mumbai Bench has held the deletion of disallowance of interest under Rule 8D(2)(ii) on the ground that if sufficient own funds were available with the assessee, no disallowance of interest would arise. However, it has allowed the administrative expense disallowance underSection 14A of Income Tax Act.

With regard to administrative expenses no fault had been found in restricting the disallowance to 0.5% of average investments yielding exempt income and upheld the addition.

Addition u/s 68 on Share Premium Unsustainable without Fair Hearing: ITAT Sets Aside ₹16.02 Cr Unexplained Income

Nathan Anil Rao vs The IncomeTax Officer – Circle 23(1)

CITATION : 2026 TAXSCAN (ITAT) 332

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) struck down the addition of ₹16.02 crore under Section 68 of the Income-tax Act, 1961 and remitted the matter back to the Assessing Officer for reassessment, observing that the assessee had not been given a fair opportunity of being heard.

The appeal was allowed for statistical purposes, reinforcing that additions under Section 68 cannot be sustained where the assessee is denied a fair hearing.

Reassessment Notice Issued Beyond 3 Year Invalid Without PCCIT Approval u/s 151(ii): ITAT Sets Aside Order

JAVITRI DEVI vs INCOME TAXOFFICER

CITATION : 2026 TAXSCAN (ITAT) 334

The Income Tax Appellate Tribunal (ITAT), Delhi Bench, held that reassessment proceedings initiated under Section 148 ofthe Income Tax Act, 1961 are invalid when the mandatory approval under Section 151(ii) is not obtained from the Principal Chief Commissioner of Income Tax (PCCIT).

The Tribunal relied on the decision of the Supreme Court in Union of India v. Rajeev Bansal (2024) and the Delhi High Court in Rajesh Gupta (HUF) v. ACIT (2023) and held that non-compliance with the statutory requirement of approval renders the reassessment proceedings unsustainable in law.

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