Top Stories ITAT Weekly Round-Up A Round-Up of the ITAT Cases Reported at Taxscan Last Week By Eeva Mary Sanil – On December 15, 2024 1:26 pm – 18 mins read ITAT invalidates PCIT’s S.263 Revision Order Issued in Deceased Taxpayer’s Name Due to Procedural Lapses [Read Order] Gitesh Chandulal Patel vs Principal Commissioner of Income-tax-3 CITATION:   2024 TAXSCAN (ITAT) 1527 The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) invalidated the Principal Commissioner of Income Tax ( PCIT )’s Section 263 revision order issued in the name of a deceased taxpayer, citing procedural lapses. Based on the facts, the two-member bench, comprising Dr BRR Kumar(Vice President) and Siddhartha Nautiyal(Judicial Member), concluded that the PCIT had failed to pass a valid order under Section 263 of the Act. The tribunal, therefore, found the order invalid. ITAT Orders CIT(E) to Grant Registration u/s 12AB, Finding No Exemption Claim u/s 11 After CPC Denial [Read Order] Swaminarayan Satsangis Organisation 306 vs The CIT (Exemption) Ahmedabad – 380 015 CITATION:   2024 TAXSCAN (ITAT) 1529 The Ahmedabad Bench of Income Tax Appellate Tribunal(ITAT) ordered the Commissioner of Income Tax(Exemption)[CIT(E)] to grant registration under Section 12AB,of the Income Tax ACt,1961, finding no exemption claim under Section 11 for the Assessment Year(AY) 2022-23 after the Centralized Processing Centre(CPC) denial. Swaminarayan Satsangis Organisation ,appellant-assessee, challenged the order passed by CIT(E) on 29/08/2024, denying the grant of registration under section 12AB of the Act.The counsel for the assessee argued that the denial of registration by the CIT(E) was based on an incorrect understanding of the facts. ITAT Orders Fresh Hearing by CIT(A) in Rs. 1.65 Crore Cash Deposit Case on the grounds of Non-Compliance [Read Order]

Ajay Jethanand Notwani vs Income Tax Officer CITATION:   2024 TAXSCAN (ITAT) 1530 The Ahmedabad Bench of Income Tax Appellate Tribunal(ITAT)ordered a fresh hearing by the Commissioner of Income Tax(Appeals)[CIT(A)] in the Rs. 1.65 crore cash deposit case on grounds of non-compliance. The two-member bench comprising Siddhartha Nautiyal(Judicial Member) and Makarand V.Mahadeokar(Accountant Member) examined the case and listened to both parties. In the interest of justice, the matter was referred back to CIT(A) for a fresh review, with instructions to allow the assessee an opportunity to be heard. It was also noted that if the assessee remained non-compliant, the CIT(A) could take appropriate action based on the available records. Delay in Assessment over DRP Order in Time–Barred Income Tax matter is Null and Void: ITAT Grants Relief to Hyundai Rotem [Read Order] Hyundai Rotem Company Indian Project Offices vs ACIT CITATION:   2024 TAXSCAN (ITAT) 1533 The Income Tax Appellate Tribunal (ITAT) in Delhi recently granted relief to Hyundai Rotem, declaring that a delay in assessment following the dispatch of the Dispute Resolution Panel (DRP) order shall result in an Assessment Order that is null and Void.

The ITAT observed that the decision of the ITAT Delhi Bench in Nikon India Private Ltd. vs. ACIT (2024) is squarely applicable to the present case. It was held that Section 13 of the Information Technology Act, 2000, along with Section 144B of the Income Tax Act, 1961, may be applicable when ascertaining the time the DRP uploaded the DRP order onto the ITBA Portal. Since the DRP Order was uploaded on the ITBA Portal on 26.05.2022, the final assessment was statutorily required to be completed on or before 30.06.2022. Identifying that the evaluation was completed only on 01.07.2022, the ITAT ruled such an assessment null and void, setting aside the order in relief to the Assessee. Assessment Reopened w/o Mandatory Application of Mind: ITAT Quashes Income Tax  Reassessment Order [Read Order] Sh. Birpal vs Income Tax Officer CITATION:   2024 TAXSCAN (ITAT) 1540 The Income Tax Appellate Tribunal ( ITAT ), Delhi Bench, quashed the reassessment order against an assessee, noting that the Revenue had reopened the assessment without mandatory application of mind. The assessee/ appellant is Sh: Birpal, a resident of Gautam Buddha Nagar, Uttar Pradesh. The tribunal scrutinised the evidence, comprising Judicial Member Shri Satbeer Singh Godara and Accountant Member Shri M. Balaganesh. It observed that the PCIT’s approval did not reflect an independent evaluation of the facts, as required under law. Despite being given ample opportunity, the Department failed to rebut this contention with substantive evidence or legal arguments.

The tribunal concluded that the PCIT’s lack of due application of mind invalided the reassessment proceedings. Citing the S. Goyanka Lime judgment and other precedents submitted by the appellant, the ITAT stressed that approval under Section 151 of the tax statute is not a mere formality but a vital safeguard to prevent arbitrary reassessments. ITAT Sets Aside Ex-Parte Order, Remands Case to CIT(A) for Fresh Hearing u/s 251 [Read Order] M/s. Aditech Infotech Pvt. Ltd vs Income Tax Officer CITATION:   2024 TAXSCAN (ITAT) 1541 The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) upheld the principles of natural justice by setting aside the ex-parte order issued by the Commissioner of Income Tax (Appeals) in the case for Assessment Years 2011-12 and 2012-13. The two-member bench comprising Siddhartha Nautiyal (Judicial Member) and Annapurna Gupta (Accountant Member) set aside the impugned order. It restored the matter to the AO for de-novo consideration, instructing that the appellant be allowed to present its case and directing the AO to give the assessee a fair opportunity to present its case. Income Tax Non-Compliance due to Issues with Online Portal: ITAT Orders Fresh Consideration in Interest of Justice [Read Order] Krupal Vikrambhai Patel vs The ITO CITATION:   2024 TAXSCAN (ITAT) 1542

The Income Tax Appellate Tribunal (ITAT), Ahmedabad, has ordered fresh consideration in a case in which non-compliance with tax regulations was attributed to technical difficulties with the income tax portal. The case involved the assessee/appellant, Krupal Vikrambhai Patel, an Ahmedabad resident. In its decision, the bench of  Vice President Dr. B.R.R. Kumar directed the Assessing Officer to conduct a de novo assessment. The tribunal ordered the authorities to reassess the case, granting the appellant sufficient opportunity to submit evidence and respond to the allegations comprehensively. As a result, the appeal was allowed for statistical purposes. ITAT Sets Aside Ex-Parte Order u/s 143(3) of Income Tax Act, Grants Assessee Another Chance Due to Non-Receipt of Hearing Notices [Read Order] Dhaval Nalinbhai Patel vs The DCIT CITATION:   2024 TAXSCAN (ITAT) 1543 The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) set aside an ex-parte order passed by the Commissioner of Income Tax(Appeals) regarding an assessment order under section 143(3) of the Income Tax Act,1961.

A two-member Bench comprising T.R. Senthil Kumar(Judicial Member) and Annapurna Gupta(Accountant Member) held that the assessee should cooperate with this final opportunity by filing all required documents and evidence in support of its grounds raised before CIT(A). Deduction u/s 80HHC is not allowable if S. 80IA deductions are already claimed: ITAT on Inox India Matter [Read Order] Inox India Limited vs Deputy Commissioner of Income Tax CITATION:   2024 TAXSCAN (ITAT) 1544 The Ahmedabad Bench of the Income Tax Appellate Tribunal ( ITAT ) ruled that deductions under Section 80HHC of the Income Tax Act, 1961 cannot be claimed for the same income if deductions under Section 80IA have already been availed. Inox India Limited, the assessee, is a company that manufactures vacuum-insulated tanks and related products. During the assessment years under consideration (2000-01, 2002-03, 2003-04, and 2004-05), the assessee claimed deductions under Section 80HHC ( profits from exports ) and Section 80IA ( income derived from eligible industrial undertakings ). The two-member bench comprising Dr. BRR Kumar ( Vice President ) and Siddhartha Nautiyal ( Judicial Member ) analyzed prior judicial rulings and observed that in cases like Atul Intermediates ( Gujarat High Court ) and Shah Alloys Ltd ( Gujarat High Court ), it was held that Section 80IA(9) prevents simultaneous deductions under Sections 80HHC and 80IA. Inox India’s Lease Rental Income from unsold Manufactured Goods Treated as Business Income, not Income from other Sources: ITAT [Read Order] Inox India Limited vs Deputy Commissioner of Income Tax CITATION:   2024 TAXSCAN (ITAT) 1544 The Ahmedabad Bench of the Income Tax Appellate Tribunal ( ITAT ) ruled that Inox India’s lease rental income derived from leasing out unsold vacuum-insulated tanks manufactured by the company qualifies as “Business Income” rather than “Income from Other Sources.”

The two-member bench comprising Dr. BRR Kumar ( Vice President ) and Siddhartha Nautiyal ( Judicial Member ) observed that the leased tanks were manufactured by the company which is directly linked the income to the manufacturing activity. Thus, the tribunal ruled that Lease rental income derived from leasing out unsold vacuum-insulated tanks was held to be “Business Income” due to its direct connection with the company’s manufacturing and business activities. ITAT Remands Back Appeal to CIT(A) u/s 249(3), Citing Delay in Filing Appeal Not a Valid Ground for Dismissal [Read Order] Rambadal Dhunmum Yadav vs The ITO CITATION:   2024 TAXSCAN (ITAT) 1545 The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) ruled that the CIT(A) cannot dismiss an income tax appeal on limitation grounds after condoning the delay. Rambadal Dhunmum Yadav, the appellant-assessee, approached the Commissioner of Income Tax(Appeals) against the Assessment Order passed on January 10, 2013.

However, the appeal was dismissed by CIT(A) due to a 65-day delay in filing the appeal. The two member Bench comprising of Dr. BRR Kumar(Vice-President) and Suchitra Kamble(Judicial Member) reviewed the case and noted that the appellant did not appear before the CIT(A) or explain the delay in filing the appeal. Therefore, the case is being sent back to the CIT(A) to assess the reason for the delay properly and decide whether to accept it, along with the issues raised by the appellant. The appellant is instructed to cooperate fully with the process and submit the necessary documents on time. If there are any further delays, the CIT(A) can take appropriate action. The appellant will also be given a fair chance to present their case, following proper procedures. ITAT Sets Aside CIT(A) Order for Failure to Provide Fair Hearing, Remands for Fresh Adjudication [Read Order] Kamlesh Babalal Shah vs ACIT Circle Palanpur CITATION:   2024 TAXSCAN (ITAT) 1546 The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) set aside the order passed by the Commissioner of Income Tax(Appeals)[CIT(A)], due to failure to provide a fair hearing to the assessee and remanded the case for fresh adjudication. Kamlesh Babalal Shah,appellant-assessee, challenged the order dated  7.2.2023 passed by the CIT(A), National Faceless Appeal Centre (NFAC) for the Assessment Year 2016-17.

The two member bench comprising Pawan Singh(Judicial Member) and Annapurna Gupta(Accountant Member) therefore set aside the order and remanded the case to the CIT(A) for a fresh hearing, instructing that the assessee be given a fair opportunity to be heard. The assessee was also advised to cooperate and avoid unnecessary adjournments. ITAT Overturns Exemption Denial: Assessee’s Delayed Filing Deemed Timely Due to Extended Deadline [Read Order] Sufi Kathak Foundation vs ITO CITATION:   2024 TAXSCAN (ITAT) 1547 Recently, The New Delhi Bench of Income Tax Appellate Tribunal(ITAT) set aside the denial of exemption under sections 11 and 12 of the Income Tax Act,1961 by the Commissioner of Income Tax (Appeals). Sufi Kathak Foundation,the appellant-assessee was denied a tax exemption for the year 2018-19.The Reason for denial was that the organisation filed its tax return and audit report late. The Bench Composed of Mahavir Singh(Vice-President) and Pradip Kumar Kedia(Accountant Member) held that the CIT(A)’s decision to deny the benefit on this basis is incorrect and should be cancelled. The CPC/JAO is instructed to reconsider the extended due date when determining the eligibility for the claim under sections 11 & 12 of the Act. ITAT upholds Rejection of Tax Exemption, Citing Non-Compliance with Charitable Purpose Criteria [Read Order] Historical Cars Association of India vs The Commissioner of Income Tax (Exemption) CITATION:   2024 TAXSCAN (ITAT) 1548 The Chennai Bench of Income Tax Appellate Tribunal ( ITAT ) upheld the rejection of Tax exemption by Commissioner of Income Tax (Exemption),citing non-compliance with charitable trust criteria as the appellant Fails to Meet Charitable Purpose Criteria Under Section 2(15) and 80G of the Income Tax Act,1961.

The two member bench composed of   S.S. Viswanethra Ravi(Judicial Member) and Jagdish(Accountant Member) observed that  the activity of the assessee, such as organizing historic car rallies, does not qualify as a “charitable purpose” as defined under Section 2(15) of the Income Tax Act,1961 as the CIT(E) pointed out. The assessee did not provide any evidence to support their claim. Additionally, since the assessee does not have registration under Section 12AB, they cannot receive approval under Section 80G. Therefore, based on the reasons provided by the CIT(E), we find no issue with rejecting the application in Form 10AB for 80G approval. As a result, the assessee’s appeal is dismissed. Disputed Set off of Rs.41L in Income Tax Assessment: ITAT Remits case for consideration of Furnished Documents [Read Order] Stephen Fernandes vs The Income Tax Officer CITATION:   2024 TAXSCAN (ITAT) 1549 The Income Tax Appellate Tribunal ( ITAT ), Bangalore recently recognized the failure by the Commissioner of Income Taxes (Appeals) ( CIT(A) )to adequately consider furnished documents in an income tax appeal pertaining to the setting off of a disputed Rs.41,44,319, and proceeded to remit the matter back to the CIT(A) for consideration of the documents already furnished.

The two-member Bench of the Income Tax Appellate Tribunal, Bangalore, constituted by George George K.,Vice President, and Laxmi Prasad Sahu, Accountant Member, considered the submissions of either party. The bench observed that the Appellant had filed voluminous documents in paper books before it and certified that no additional evidence had been filed. CIT(A) fails to Dismiss Appeal on Merits: ITAT condones 2 year 19 days Delay in Filing Income Tax Appeal [Read Order] Power Equipment Company vs The ADIT CITATION:   2024 TAXSCAN (ITAT) 1550 The Surat Bench of Income Tax Appellate Tribunal ( ITAT ) remanded Power Equipment Company’s case to the Commissioner of Income Tax (Appeals) CIT(A), National Faceless Appeal Centre ( NFAC )  for re-examination of the assessee’s tax returns and passed an order on merit. The Appellant assessee—Power Equipment Company, appealed against an order passed by the Additional Commissioner of Income Tax (CIT) dated 12.06.2024 for the assessment year (AY) 2020-21, disputing the addition made under Section. The ITАT benсh, comprising Judicial Member Рawan Singh and Аccountant Mеmbеr Bijayananda Рruseth, concluded that thе delay in filing the appeal was neithеr deliberate nor due tо negligence by thе аssessee. Рrioritizing substantiаl justice over technicalities, thе benсh remanded thе mаtter tо thе CIТ(А) for vеrification оf thе сlaim and directed a dеcision on merit, thereby allowing the appeal. ITAT Cancels Rs. 58.97 Lakh Penalty, Says Issue is Debatable and not a Clear Case of Concealment [Read Order] Gujarat Insecticides Ltd vs The Dy.CIT CITATION:

2024 TAXSCAN (ITAT) 1551 Recently, Ahmedabad Bench of the Income Tax Appellate Tribunal ( ITAT ) set aside a penalty of Rs. 58.97 lakh imposed by the Assessing Officer ( AO ), noting that the issue of disallowance of a claim of Rs. 1,73,51,790 was debatable and not a clear case of furnishing inaccurate particulars. Gujarat Insecticides Ltd., the assessee has filed an appeal against the order of the CIT(A), dated 26.03.2024, which upheld the penalty of Rs. 58,97,870 levied by the Assessing Officer ( AO ) under Section 271(1)(c) of the Income Tax Act, 1961, related to the disallowance of a claim of Rs. 1,73,51,790 as a business loss or bad debt. AO classifies Agricultural Expenses as Undisclosed Income u/s 69(c): ITAT Deletes Addition [Read Order] Ajay Ravjibhai Patel vs The ITO CITATION:   2024 TAXSCAN (ITAT) 1552 The Surat bench of the Income Tax Appellate Tribunal (ITAT) deleted an addition made by the Assessing Officer (AO) against the assessee on agricultural expenses as undisclosed income under Section 69(c) of the Income Tax Act in the case of Ajay Ravjibhai Patel. The assessee Ajay Ravijibhai Patel pursued an appeal against an order passed under section 250 of the Income Tax Act dated 28.01.24 by the Commissioner of Income Tax (Appeals) CIT(A), National Faceless Appeal Centre NFAC for the assessment year (AY) 2016-17. The ITAT bench, comprising Pawan Singh ( Judicial Member ) and Bijyananda Pruseth ( Accountant Member ), realised that the proper course of action would be to reduce the exempted agricultural income by Rs.10,28,410 —instead of adding the undisclosed income of Rs.7,83,093—estimated by the AO. Furthermore, the Tribunal ordered the addition made by the AO for undisclosed income to be deleted, and as a result, the appeal was allowed. Fraud Allegations Lead to ₹6.61 Crore Addition as Undisclosed Income: ITAT Orders Reassessment with Cost [Read Order] Jagdishbhai Karamshibhai Bodra vs The DCIT CITATION:   2024 TAXSCAN (ITAT) 1553

The Surat bench of the Income Tax Appellate Tribunal ( ITAT ) in the case of Jagdishbhai Karamshibhai Bodra, ordered for reassessment in the case of an alleged fraud case highlighting the importance of upholding the principles of Natural Justice. In the Instant case, the assessee, Jagdishbhai Karamshibhai Bodra, filed four appeals against the order passed by the Commissioner of Income Tax (Appeals) CIT(A), National Faceless Appeal Centre ( NFAC ) under Section 250 of the Income Tax Act, for the assessment years (AYs) 2013-14 and 2014-15. Two appeals are against an order under Section 147 of the Act, and the other two are against the penalty orders under Section 271(1)(c) for the AYs as mentioned above. Addition by AO u/s 28(iv) of Income Tax Act unwarranted as Free Test Assets are Returned or Destroyed and Software Pricing Set by MAP: ITAT [Read Order] Samsung R&D Institute India – Bangalore Pvt. Ltd vs JCIT CITATION:   2024 TAXSCAN (ITAT) 1554 The Income Tax Appellate Tribunal ( ITAT ), Bangalore in a recent matter held that no addition may be made by an Assessing Officer ( AO ) under Section 28(iv) of the Income Tax Act, 1961 in the event that imported assets were provided to the Assessee free of cost, exclusively for the purpose of testing which were either returned or destroyed post-testing, and where the pricing of the assets were determined by means of the Mutual Agreement Procedure ( MAP ).

The Income Tax Appeal was filed by Samsung R&D Institute India (Samsung) against the order of the Commissioner of Income Tax (Appeals)-10 Bangalore ( CIT(A) ) with regards to the financials of the Assessee for the Assessment Year (A.Y.) 2015-16. Rs.29.32 Lakh Unexplained Investment: ITAT Remands Matter Back to CIT(A) Due to Inadequate Reasoning [Read Order] Firoz Pasha vs Income-tax Officer CITATION:   2024 TAXSCAN (ITAT) 1556 The Delhi Bench of Income Tax Appellate Tribunal ( ITAT )  remanded the matter back to the Commissioner of Income Tax(Appeals) [ CIT(A) ] due to inadequate reasoning and failure to frame points of determination regarding the Rs. 29.32 lakh unexplained investment, as required under section 250(6) of the Income Tax Act,1961. Firoz Pasha,appellant-assessee,has filed an appeal against the order dated 29.11.2023, issued by the CIT(A)/National Faceless Appeal Centre (INFAC), for the assessment year (AY)2012-13, concerning proceedings under section 250 of the  Act. A single member bench comprising Satbeer Singh Godara (Judicial Member) decided to remand the case to the CIT(A) for fresh adjudication, with the assessee being given three opportunities to present their case and the responsibility to prove all relevant facts in the proceedings. ITAT Reduces Penalty to Rs 10,000 for Non-Response to Notices, Citing Assessee’s Depression and Business Loss [Read Order] Jayasakthi Knit Wear vs The ITO CITATION:   2024 TAXSCAN (ITAT) 1558

The Chennai Bench of Income Tax Appellate Tribunal ( ITAT ) reduces the penalty levied upon the appellant by Commissioner of Income Tax (Appeals). Jayasakthi Knit Wear,appellant-assessee approached the Tribunal against the decision made by CIT(A0. The primary issue raised by the assessee pertains to the order passed by the CIT(A), which upheld the penalty imposed under Section 271(1)(b) of the Income Tax Act, 1961. The penalty, amounting to Rs. 40,000, was levied for the assessee’s failure to respond to notices issued by the Assessing Officer ( AO ) on four separate occasions. The assessee’s defense is that due to significant financial losses incurred in the business, the assessee was unable to respond to the notices, which led to a state of depression. As a result, the assessee contends that the failure to comply with the AO’s notices was not willful but rather a consequence of the mental distress caused by the financial setbacks. Furthermore, the assessee  submitted an affidavit requesting leniency, seeking a reconsideration of the penalty on humanitarian grounds. Despite this, the CIT(A) upheld the penalty, confirming the levy of Rs. 40,000. ITAT Remands Case to CIT(A) for Fresh Hearing, Citing Lack of Opportunity for Assessee to be Heard [Read Order] Prashant Bharatkumar Shah vs Income Tax Officer CITATION:   2024 TAXSCAN (ITAT) 1559 The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) remanded the matter to the Commissioner of Income Tax (Appeals) [CIT(A)] for fresh adjudication due to the denial of a personal hearing to the assessee. Prashant Bharatkumar Shah, the appellant-assessee, had an assessment order passed against him by the Income Tax Officer, with an addition of ₹1,35,28,150 under Section 69, for the Assessment Year 2015-16. In response, he filed an appeal before the CIT(A), which was dismissed by order dated 24/05/2024.

This dismissal by the CIT(A) is the subject of the current challenge. ITAT directs CIT(A) to Conduct Fresh Hearing, Imposes ₹5,000 Cost for Non-Attendance in Appeal [Read Order] Sandip Kiritbhai Patel HUF vs Deputy Commissioner of Income tax CITATION:   2024 TAXSCAN (ITAT) 1560 The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) directed the Commissioner of Income Tax(Appeals)[CIT(A)] to conduct a fresh hearing after dismissing the appeal for non-prosecution. It imposed a ₹5,000 cost to be paid to the “Prime Minister’s National Relief Fund” for the delay caused by non-attendance. Sandip Kiritbhai Patel HUF,appellant-assessee, filed its income tax return for AY 2013-14, declaring Nil income. The case was reopened based on information that it had benefited from bogus LTCG and accommodation entries through VAS Infra Ltd and Naresh Jain. The Assessing Officer(AO) made additions under Section 68 as the entries remained unexplained.

ITAT Rejects Cooperative Bank’s Bad Debt Reserve Claim u/s 36(1)(viia), Allows FD Loss as Business Expense [Read Order] Surat National Co.op Bank Ltd. vs The ACIT CITATION:   2024 TAXSCAN (ITAT) 1562 The Surat Bench of the Income Tax Appellate Tribunal ( ITAT ), in a recent ruling, rejected a cooperative bank’s claim of bank debt reserves under Section 36(1)(viia) of the Income Tax Act 1961, stating the authenticity of such claims. Surat National Co.op Bank Ltd the assessee, pursued two appeals against the orders passed by the Commissioner of Income Tax (Appeals) CIT(A), National Faceless Appeal Centre ( NFAC ) on 03.10.2024 and 19.01.2023, for the assessment years (AYs) 2013-14 and 2014-15. The two-member bench consisting of Pawan Singh ( Judicial member ) and Binjayananda Pruseth ( Accountant Member ) rejected the AO’s allegation that the assessee had claimed a double deduction. It held that the accounting system followed by the assessee resulted in only one deduction. The tribunal further observed that there was a delay in recognising the loss, but it was an issue that the RBI had to sort.

As a result the bad debt claim made by the assessee was rejected. Medical Reasons caused Delay in Appeal after Payment of Requisite Fees: ITAT remands Matter to CIT(A) [Read Order] Narayanappa Govindaraju vs The Deputy Commissioner of Income Tax CITATION:   2024 TAXSCAN (ITAT) 1563 The Income Tax Appellate Tribunal ( ITAT ), Bangalore while hearing an Income Tax Appeal, endorsed the medical reasons cited by the Appellant while praying for the condonation of delay to file the appeal, after due payment of the requisite fees to file the appeal. The Assessee, Narayanappa Gondaraju filed their returns of income for the Assessment Year (A.Y.) 2013-14 under Section 139(1) of the Income Tax Act, 1961 declaring a gross total income of Rs.8,83,217. Subsequently, in 2018 a search was conducted in Bangalore by the Department with regards to another Assessee by the name of T.Suresh which revealed additional details regarding the Assessee’s case. ITAT Remands Case Back to CIT(A) for Fresh Adjudication Over Unsecured Loans of Rs.1.42 Crore [Read Order]

Bhupendra Shantilal Shah vs The Dy.CIT CITATION:   2024 TAXSCAN (ITAT) 1564 The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) remanded a case involving unsecured loans of Rs.1.42 crore back to the Commissioner of Income Tax (Appeals), CIT(A) for fresh adjudication. Bhupendra Shantilal Shah,the appellant-assessee filed his income tax return for the year 2017-18 on 27th March 2018, declaring an income of Rs 9,97,030. His return was selected for detailed review because of large cash deposits during the demonetization period and the size of the deposits compared to his declared income. The two member Bench of Suchitra Kamble(Judicial Member) and Makarand V Mahadeokar(Accountant Member) without going into the merits of the case set aside the order of CIT(A) and remanded the matter back to the CIT(A) , also directed the CIT(A) to verify the authenticity, completeness, and relevance of the documents submitted, also to provide a reasonable opportunity to the AO to examine the additional evidence and ensure that the principles of natural justice are followed by allowing the assessee a fair hearing. Tribunal Penalizes Assessee Rs. 10,000 for Non-Compliance, Directs AO to Re-Examine Case [Read Order] Anmol Developers vs The ITO CITATION:   2024 TAXSCAN (ITAT) 1565 The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) set aside the order passed by Commissioner of Income Tax (Appeals),CIT(A) and restored the matter back to the file of Jurisdictional Assessing Officer for fresh consideration, imposing a cost of Rs.10,000 on the assessee for non-compliance with notices. Anmol Developers, appellant-assessee, a firm engaged in real estate business, failed to file its regular return of income for A.Y. 2017-18, prompting the Assessing Officer to issue notices under Sections 148 and 142(1) of the Act. The two-member bench comprising TR Senthil Kumar (Judicial Member) and Annapurna Gupta (Accountant Member) observed that the Assessing Officer’s addition of Rs. 7.22 crores required verification, and thus, set aside the orders passed by the lower authorities and restored the matter back to the file of the Jurisdictional Assessing Officer with a direction to consider the issue afresh. ITAT orders Condonation of 1809-Day Delay in FTC Disallowance Appeal After Verification of Form 67 [Read Order] Ram Avadhanulu Jonnavithula vs The Deputy Commissioner of Income Tax CITATION:   2024 TAXSCAN (ITAT) 1567 The Bangalore Bench of the Income Tax Appellate Tribunal ( ITAT ) passed a decision to condone a delay of 1809 days in a matter regarding disallowance of Foreign Tax Credit ( FTC ), while also advising the Assessing Officer ( AO ) to conduct due verification of Form 67. Ram Avadhanulu Jonnavithula, the Appellant-Assessee had filed an Income Tax Appeal against an ex parte order passed by the Commissioner of Income Taxes ( CIT(A) ) at the National Faceless Appeal Centre, Delhi (NFAC) with regards to the financials of the Assessee for the  Assessment Year (A.Y.) 2017-18. Illiterate Assessee Running Mobile Shop fails to Comply with Income Tax Notice: ITAT imposes Fine [Read Order] Krintesh Rameshbhai Patel vs DCIT CITATION:   2024 TAXSCAN (ITAT) 1568 The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) set aside the order made income tax addition on unexplained income due to non compliance considering the assessee being an illiterate running a small mobile recharging shop. The bench also imposed a cost of Rs.5,000 as fine. Krintesh Rameshbhai Patel, the appellant-assessee, carrying on a small business of mobile recharging, failed to comply with notices, prompting the Assessing Officer to treat cash deposits of Rs.54,94,100 as unexplained income for A.Y. 2017-18. The two member Bench comprised of Suchitra Kamble(Judicial Member) and Narendra Prasad Sinha(Accountant Member) noted that the AO did not fully consider the bank transactions, and it was important to assess the deposits and transfers as part of the same business activity. Therefore, the Tribunal decided to send the matter back to the AO with directions to give the assessee another opportunity to explain the deposits and produce the necessary evidence.

₹3 Crores Gift from NRI Son to Mother Deemed Valid and Non-Taxable: ITAT Citing Donor’s Sufficient Funds [Read Order] DCIT vs Lalita Devi Agarwal CITATION:   2024 TAXSCAN (ITAT) 1569 The Mumbai Bench of the Income Tax Appellate Tribunal ( ITAT ) ruled that the assessee received Rs. 3 crores gift from her NRI son was deemed valid and non-taxable under the Income Tax Act citing the Donor’s sufficient funds. Lalita Devi Agarwal, the assessee received a gift of Rs 3 crores from her son, Barun Agarwal, a Non-Resident of India. She received the gift via RTGS transactions on 14.03.2011 and 17.03.2011. The son was a hedge fund operator based in Hong Kong and transferred the funds from his Hong Kong account to his Indian account before gifting the amount. The assessee used the gifted amount to provide an unsecured loan of Rs.2.7 crores to Mangalam Vanijya Pvt. Ltd. and purchased shares in the same company. Natural Justice Violated by unfair Deadline: ITAT Remands ₹1.3 Cr Addition case u/s 69C to AO [Read Order] Super Sonic Impex vs The ITO CITATION:   2024 TAXSCAN (ITAT) 1576 The Surat bench of the Income Tax Appellate Tribunal ( ITAT ) in the case of supersonic impex held that a deadline of three days for submission of all relevant records of the assessee’s accounts was unfair and such unfair deadline was indeed a violation of natural justice principles.

The assessee had appealed against an order passed by the Commissioner of Income Tax (Appeals) [CIT(A)], National Faceless Appeal Centre ( NFAC ) under Section 250 of the Income Tax Act 1961, for the assessment year (AY) 2018-19. The two-member bench, consisting of Pawan Singh ( Judicial Member ) and Bijayananda Pruseth ( Accountant Member ), held that it is settled that natural justice and fair play require that the affected party be given sufficient opportunity to be heard to present his case. ITAT rescinds Ex-Parte Addition of Rs.36L u/s 69A, directs Explanation of Disputed Financial Records [Read Order] Ajjahar Ghaniwala vs The ITO CITATION:   2024 TAXSCAN (ITAT) 1578 The Ahmedabad Bench of the Income Tax Appellate Tribunal ( ITAT ) recently directed denovo Assessment of an Assessee’s matter observing that the Assessing Officer (AO) had conducted ex-parte addition of Rs.36,01,500/- under Section 69A of the Income Tax Act, 1961 after duly assessing all financial records adducible by the Assessee. The Decision was given by the Ahmedabad ITAT while hearing an Income Tax Appeal filed by the Appellant-Assessee Ajjahar Ghaniwala against the order dated 30.11.2023 passed by the Commissioner of Income Taxes (Appeals) (CIT(A)) at the National Faceless Appeal Centre under Section 250 of the Income Tax Act. Against the financials of the Assessee for the Assessment Year (A.Y.) 2017-18. Delay in filing Form 10B by Charitable Trust for Sec.11 Exemptions: ITAT directs CIT(A) Adjudication on Potential Condonation by CIT(E) [Read Order] Sri Jagadguru Shivanand Human Welfre Association Gadag vs ITO CITATION:   2024 TAXSCAN (ITAT) 1579

The Income Tax Appellate Tribunal ( ITAT ), Bangalore recently issued directions to the Commissioner of Income Taxes ( Appeals ) ( CIT(A) ) to conduct renewed consideration of an Appeal on the basis of possible condonation of delay by the Commissioner of Income Taxes ( Exemptions ) ( CIT(E) ) in a matter concerning delay in filing Form 10B by a Charitable Trust. The Appeal against the Order of the CIT(A), Prayagraj pertained to Assessment Year (A.Y.)  2022-23, and was filed before the Bangalore ITAT by Sri Jagadguru Shivanand Human Welfare Association, a charitable trust seeking to avail exemptions under Section 11 of the Income Tax Act, 1961. Unexplained Cash Credit During Demonetization Period: ITAT upholds CIT(A) Deletion [Read Order] Deputy Commissioner of Income Tax vs Bongaon Co Operative Credit Society Limited CITATION:   2024 TAXSCAN (ITAT) 1580 The Kolkata Bench of Income Tax Appellate Tribunal(ITAT) upheld the CIT(A)’s decision to delete the addition of unexplained cash credit during the demonetization period, rejecting the Revenue’s appeal. The Revenue-appellant challenged the order passed by CIT(A) dated 23.08.2023, which was issued under section 250 of the Act for the Assessment Year(AY) 2017-18. This order was passed in response to the assessment order under section 143(3) of the Act, dated 15.12.2019.