This ITAT ruling draws a clear line: it upheld the legal and evidence-based addition of ₹6.12 lakh for deemed rental income on multiple house properties, but simultaneously deleted the entire ₹5,87,500 addition for unexplained cash credit, condemning the use of arbitrary 50% estimations by tax authorities.
The Tribunal deleted the ₹10 lakh penalty, ruling that an estimated addition based on the non-genuineness of purchases does not constitute concealment or furnishing inaccurate particulars. The decision reaffirms the Supreme Court principle that making an unsustainable claim does not automatically attract a penalty.
The ITAT significantly reduced an unexplained cash credit addition from Rs. 32.86 lakh to a lump-sum of Rs.4 lakh, reasoning that a regular exporter with maintained books cannot have the entire demonetisation deposit treated as unexplained. Crucially, the Tribunal directed the tax to be computed at normal rates, holding that Section 115BBE (higher tax rate) does not apply to the financial year 2016-17.
The ITAT invalidated a reassessment order because the Assessing Officer (AO) failed to make any addition on the sole issue for which the reassessment was initiated (cash deposits). Citing binding precedent, the Tribunal ruled that once the reason to believe ground is not established, the AO loses jurisdiction to make additions on entirely new issues, quashing the entire assessment.
Approval under Section 153D was invalid, as it was granted mechanically and collectively for several years, without independent application of mind. Such perfunctory approval defeats the statutory safeguard intended by the legislature. Consequently, the entire proceedings and assessments were quashed.
ITAT Delhi ruled in favor of Air Con Systems (India) Pvt. Ltd., deleting a ₹62,00,000 addition made under Section 69A of the Income Tax Act. The addition was based solely on notings in an undated loose paper seized from a third party’s residence.
Adopting a principle of consistency, the ITAT Delhi restored the appeal for AY 2009-10 to the CIT(A), following its own earlier order for AYs 2010-11 to 2019-20 in the assessees case. The ruling ensures that the legal heir gets a proper chance to present evidence and submissions, thereby nullifying the additions made in the ex-parte proceedings.
The ITAT Delhi allowed the appeal because the penalty under Section 271A for non-maintenance of books had already been deleted by the Tribunal, establishing that the authority was not legally obliged to keep books. The Tribunal concluded that if no books are required to be maintained under Section 44AA, no penalty for failure to audit them under Section 271B can legally survive.
ITAT Delhi held that enhancement made by CIT(A) in absence of show cause notice issued under section 251 of the Income Tax Act is wholly unsustainable in law. Accordingly, the appeal is allowed and enhancement is quashed.
ITAT Delhi rules DigiCert Inc’s receipts from Indian resellers for digital security certificates aren’t royalty or FTS. It’s a non-taxable sale of a copyrighted article.
