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 Chennai directed the CIT(E) to reconsider a trusts 80G application on merits, ruling it couldnt be rejected mechanically on grounds of delay. The Tribunal held that since the Finance Act, 2024 amendment (Section 80G(5)(iv)) allowing trusts to apply at any time took effect while the application was pending, the CIT(E) was bound to apply the amended, flexible law.
The ITAT Chennai deleted the disallowance of claimed agricultural income, ruling that revenue from the sale of eucalyptus trees grown on the assessees agricultural land is exempt under Section 2(1A). The Tribunal held that the assessee performed both basic and subsequent agricultural operations, and the AOs mere doubt about visible maintenance was insufficient to deny the exemption.
ITAT Chennai held that reassessment notice issued by the Jurisdictional Assessing Officer post Faceless Assessment instead of National Faceless Assessment Centre is void and invalid. Accordingly, appeal is allowed.
ITAT Chennai restored a lakh addition made u/s 115BBC to a trust, granting one chance to furnish complete donor details (name, address, PAN, and mode of receipt).
The ITAT ruled that only the Gross Profit (GP) percentage on unaccounted purchases, not the entire purchase value, is taxable as undisclosed income. The Tribunal rejected the inflated purchase rate of Rs. 1,500 based solely on a partner’s statement, instead fixing a fair estimated rate of Rs. 770 per unit.
The ITAT Chennai Bench dismissed an appeal because the Assessing Officer (AO) was located in Hyderabad, violating Rule 4 which dictates ITAT jurisdiction is based on the AO’s office. The ruling affirmed the principle from the Supreme Court that appeals must be filed before the correct jurisdictional ITAT Bench, though it granted the taxpayer liberty to refile properly.
ITAT Chennai held that revisional powers under Section 263 cannot be used to substitute the Assessing Officer’s view when proper enquiry was conducted. The AO’s acceptance of business loss and PF/ESI deductions was valid.
ITAT Chennai rules that the Section 54 capital gains deduction cannot be denied solely because sale proceeds weren’t deposited in CGAS before the return deadline, provided the amount is used within three years.
Provision for customer loyalty points, computed on a scientific and consistent basis, constituted a present and ascertained liability deductible under Section 37(1). Disallowance u/s 14A was deleted since no exempt income was earned during the year.
