The Tribunal found the principles of natural justice were violated when the assessee, a villager unfamiliar with e-proceedings, was denied the opportunity to challenge the property’s stamp duty valuation and request a reference to the Departmental Valuation Officer (DVO) under Section 50C(2) of the Income Tax Act.
Chennai ITAT ruled that a police canteen operating on the principle of mutuality is not carrying on ‘business’ under the Income-tax Act, making the mandatory tax audit provision of u/s44AB inapplicable, despite high turnover reflected in GST returns. The u/s 271 B penalty for non-filing was deleted.
The ITAT dismissed an assessee’s quantum appeal, confirming that a ₹10.42 Cr write-off for decommissioned windmills was a capital loss, not a revenue deduction. Since the trust offered this as business income, the ITAT held the only permissible treatment was adjustment in the block of assets.
The ITAT set aside a Section 69A addition for unexplained cash payments, ruling that the AO must first verify the facts. The case was remanded because the assessee claimed an original allottee made the payment but failed to provide the plot’s transfer agreement as proof.
In a case involving a slum rehabilitation developer who did not file a return or maintain books, ITAT Pune applied a 12% estimated net profit rate on total gross receipts of Rs.1,93,64,405 to compute taxable income. This decision provides a precedent for estimating income in the construction sector where audited accounts are unavailable, allowing for usual business deductions.
The ITAT deleted a ₹78 lakh addition made under Section 68 for alleged accommodation entries from two companies, ruling the issue was covered by multiple binding coordinate bench decisions. Following prior judgments, the Tribunal held that M/s Jay Jyoti India Pvt. Ltd. and related entities were genuine concerns, thus the cash credit addition could not be sustained.
This critical ruling confirms the principle that a notice issued to a dead person is legally null and void, even if a legal heir later participates in the assessment. The ITAT emphasized that the correct procedure was to initiate proceedings afresh against the legal heir, not to continue the invalid proceedings, thereby quashing the entire reassessment.
The ITAT set aside the PCIT’s revision order, confirming that the sale of an entire residential building floor-by-floor to different buyers still constitutes the sale of one single house property for Section 54 claim purposes. Since the AO had already examined the capital gains claim in detail, the assessment was neither erroneous nor prejudicial to the Revenue, invalidating the Section 263 proceedings.
The Tribunal directed the PCIT to reconsider a u/s 263 order, emphasizing that the PCIT is legally bound to examine and deal with the assessee’s explanations, such as increased sales due to an early festival season. The key takeaway is that merely issuing a notice is insufficient; the PCIT’s final order must be a speaking order that addresses all submissions.
The ITAT set aside the PCIT’s revision order, confirming that the revisional power under Section 263 cannot be invoked merely to conduct a deeper inquiry or change a view previously taken by the AO. Since the AO had specifically examined and verified the share’s Fair Market Value (FMV) during the original scrutiny, the assessment was neither erroneous nor prejudicial to the Revenue.
