ITAT Ahmedabad ruled that a penalty under Section 271(1)(c) cannot survive when the underlying quantum addition has been remanded for fresh adjudication. The penalty order was restored to the CIT(A) to be decided only after the quantum appeal is finalized.
The ITAT Delhi partly deleted an addition for alleged bogus purchases, ruling that since the books of account were not rejected and the profit element from corresponding sales was already offered to tax, taxing 12.5% of the bogus purchase value constituted double taxation. The Tribunal finally restricted the addition to an agreed-upon amount of Rs.4,00,000.
Delhi ITAT deleted an addition of 71.12 lakh, holding that the assessee sufficiently explained the cash deposits by correlating them with prior cash withdrawals recorded in the books. The ruling emphasizes that S. 69A (unexplained money) cannot be invoked when the source of deposits is traced to funds from bank accounts already part of the regular books.
The ITAT Ahmedabad upheld the deletion of a Rs.2.23 crore addition made under Section 68, ruling that the assessee had fully discharged the onus of proving the identity, genuineness, and creditworthiness of the unsecured loan creditors. Since complete evidence (confirmations, PAN, ITRs, bank statements) was filed and no adverse material was found, the addition could not be sustained.
The Tribunal quashed an unexplained investment addition based purely on a digital ledger retrieved from a mobile phone, as it was not corroborated by any evidence of actual cash payment or movement. Following its own prior ruling, the ITAT confirmed that digital evidence like WhatsApp messages must comply with Section 65B to be est in law.
The ITAT partially allowed the assessee’s appeal, deleting Rs.26.16 lakh of the unexplained cash deposit added under Section 68 for the demonetisation period. The ruling emphasizes that tax authorities should make a fair estimation when the assessee’s explanation has partial merit, even if the documentary proof is insufficient to justify the whole claim.
ITAT Ahmedabad ruled that while purchases from a blacklisted entity were not fully proven, the entire amount couldn’t be added to income as corresponding sales were accepted. Following Gujarat High Court precedents, the Tribunal restricted the addition to a 5% profit markup over the declared Gross Profit rate of 12.63%, thereby deleting the majority of the original Rs. 92,20,100 addition.
The Base Metal Chemicals vs ACIT case examines the validity of large tax additions made by the AO on conversion charges, partner payments, under-invoiced sales, and stock valuation. The key issue was whether the additions were based on commercial reality or mere presumption.
The ITAT confirmed that a commission paid to non-resident agents operating solely abroad, without a Permanent Establishment (PE) in India, is not taxable in the country. This finding resulted in the cancellation of the disallowance made under Section 40(a)(i) for non-deduction of tax.
The Tribunal ruled that an HUF, the beneficial owner of the income, cant be denied TDS credit just because the tax was initially shown in the Kartas PAN. The matter was remitted to the Assessing Officer to verify subsequent compliance with Rule 37BA(2) and the updated Form 26AS to prevent the Revenues unjust enrichment.
