Section 54F Deduction Remanded as Tenants’ Affidavits Suggest Commercial Use of Properties, No Addition Without Corroborative Evidence: ITAT Deletes ₹50 Lakh On-Money Addition in Property Deal and Presumption Under Section 132(4A) Cannot Be Applied Against Assessee When Documents Seized from Third Party
The Tribunal held that reassessment under Sections 147/148 is invalid when the assessment year is the year of search. Such cases must proceed under normal assessment provisions.
The Tribunal held that accumulated savings and customary cash gifts over 40 years of marital life were a plausible explanation for seized cash. It deleted the addition sustained by the CIT(A).
Relying on CBDT instructions and precedent, the Tribunal ruled that approval for reopening must come from the CCIT. Approval by PCIT rendered the notice and assessment unsustainable.
It was ruled that approval under Section 151 granted mechanically, with contradictory stands taken by the authority, vitiates the reopening. The reassessment was set aside for lack of proper application of mind.
Authorities taxed refund interest as business income by linking it to earlier PE years. The Tribunal ruled that without a PE in the year of receipt, the income cannot be treated as effectively connected and must enjoy DTAA relief.
The ruling clarifies that Rule 46A is not breached when additional evidence is remanded but the Assessing Officer fails to respond. Relief granted by the CIT(A) in such cases remains valid.
The issue was whether 100% of alleged bogus purchases could be disallowed despite accepted production and sales. The Tribunal held that only the embedded profit element can be taxed, not the entire purchase value.
The ITAT held that the PCIT (Central) had no authority to cancel trust registration under Section 12AB. Jurisdiction for exemption matters lies exclusively with the Commissioner (Exemption).
The Tribunal found that full construction cost was not proved with evidence. However, a reasonable ad-hoc allowance was granted considering practical difficulties.
