The ITAT Ahmedabad set aside the addition of ₹2.28 crore LTCG, holding that the Assessing Officer failed to conduct any independent inquiry or verify the assessees documentary evidence before treating the gain as bogus. The Tribunal restored the case, emphasizing that an allegation of penny stock misuse cannot be sustained merely on third-party information without a proper, on-merits examination of the assessees documentation.
The Tribunal set aside the addition of LTCG and commission under Section 69C, affirming that the Revenue cannot deny exemption under Section 10(38) based on a general investigation into Kushal Tradelink without establishing the assessees direct involvement in the accommodation entries. This ruling confirms that once the assessee discharges the initial burden of proof, the Revenue must provide contrary material to sustain the addition.
The Income Tax Appellate Tribunal (ITAT) Ahmedabad ruled in Sthanakvasi Jain Sangh Jivrajpark Vs CIT (Exemption) that a trust with composite, charitable, and incidental religious objects cannot be denied 80G registration merely because one object seems religious.
ITAT Ahmedabad held that payment of non-compete fees to retiring partner is revenue expenditure. Accordingly, considering the same as capital expenditure not justifiable. The appeal is allowed to that extent.
The ITAT confirmed the penalty levy, ruling that a subsequent rectification order allowing carry-forward losses doesn’t affect the penalty base. Penalty is tied to the tax evaded on the additions confirmed by the appellate body ( crore), not the final assessed income.
The ITAT ruled that filing a revised return does not restrict interest entitlement on the amount claimed in the original, timely filed return, citing the Gujarat High Court. Interest must run from April 1st of the assessment year on the bulk refund, with the later date applying only to the incremental claim.
The ITAT ruled that the AO and CIT(A) erred by mechanically raising a default demand simply because commission was paid to a non-resident. The Tribunal stressed that full compliance evidence (Form 15CB, Form 27Q, DTAA analysis) must be examined before classifying the assessee as a defaulter.
The ITAT Ahmedabad, applying the Supreme Court’s Rajeev Bansal ruling and Gujarat High Court’s precedent, invalidated a reassessment for AY 2017-18. The order u/s 148A(d) and fresh u/s 148 notice, stemming from a deemed notice issued on 30.06.2021, were held time-barred as they were issued 20 days beyond the maximum seven-day ‘surviving time’ limit.
The ITAT deleted the addition, ruling the CIT(A)’s rejection of agricultural income based solely on bank deposits not tallying bill-to-bill was arbitrary and illogical. Once the genuine agricultural activity was accepted, timing differences or cash accumulation must be considered.
The ITAT deleted a capital gains addition, ruling that the use of an individual’s PAN during a property sale cannot legally override clinching documentary evidence proving ownership by an HUF and a Trust. Legal ownership (Will, sale deed, bank receipts) prevails over a mere technicality.
