Madras High Court Holds Post-Search Return Invalid In Block Assessment, Rejects Kerala Roadways' Claim

The Madras High Court on 7 April, held that a return filed after the initiation of search proceedings and beyond the due date cannot qualify as a valid disclosure to exclude such income from undisclosed income in block assessment under the Income Tax Act. A Division Bench of Justices G. Jayachandran and R. Sakthivel rejected the Kerala Roadways appeal. It partly accepted one of the Revenue's appeals and fully accepted another, while deciding issues on block assessment, revisional powers, and...

Supreme Court Declines To Interfere With Calcutta High Court IT Order Favouring Britannia

The Supreme Court on Tuesday refused to interfere with a tax department plea against Britannia Industries Ltd, upholding a Calcutta High Court ruling that had set aside a Income Tax revision order. The dispute concerned the valuation of property acquired by the company and deductions claimed for statutory dues such as taxes.A bench of Justices Pamidighantam Sri Narasimha and Alok Aradhe, while declining to interfere with the High Court's order, kept the interpretation of Section 56(2)(x) of the...

IT Appellate Authority Must Pass Speaking Order, Hear AO Before Admitting Fresh Evidence: J&K&L High Court

The Jammu and Kashmir and Ladakh High Court has recently held that an appellate authority under the Income Tax law cannot allow a taxpayer to file fresh evidence at the appeal stage without first passing a reasoned order and giving the tax officer a fair chance to respond. A bench of Justice Sanjeev Kumar and Justice Sanjay Parihar said, “We are also of the clear view that the opportunity to lead additional evidence at the appellate stage could not be granted by the First Appellate Authority...

CIT(A) Cannot Introduce New Income Source While Enhancing Assessment: ITAT Mumbai

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) held that the Commissioner of Income Tax (Appeals) cannot enhance income by introducing a new source of income that the Assessing Officer (AO) did not examine during assessment. It ruled that enhancement powers do not extend to issues beyond the scope of the original assessment.The Bench comprising Vice President Saktijit Dey and Accountant Member Arun Khodpia allowed Skyline Greathills' appeal on the Work-in-Progress (WIP) enhancement...

ITAT Delhi Upholds Deletion Of ₹10.5 Crore Addition Based On Retracted Statement In Oppo Search Case

The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT) on 17 April upheld the deletion of a Rs. 10.5 crore addition made solely on the basis of a retracted statement recorded during search proceedings, holding that such statements, in the absence of corroborative evidence, cannot by themselves sustain an addition under the Income-tax Act. A Bench comprising Judicial Member Anubhav Sharma and Accountant Member Manish Agarwal dismissed the Revenue's appeal and affirmed the order of the...

Reassessment Notices Invalid Where No Escaped Income In Form Of 'Asset' Above ₹50 Lakh: ITAT New Delhi

The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT) on 17 April, held that reassessment proceedings initiated beyond three years are invalid unless the Revenue demonstrates that the alleged escaped income is represented in the form of an “asset” exceeding Rs. 50 lakh, as required under Section 149(1)(b) of the Income-tax Act. A Bench comprising Judicial Member Anubhav Sharma and Accountant Member Manish Agarwal quashed reassessment notices issued under Section 148 in the case of...

ITAT Chennai Deletes ₹49.80 Lakh Additions On Flat Purchase And Cash Deposits, Allows Reinvestment Benefit

The Income Tax Appellate Tribunal (ITAT) in Chennai has recently deleted additions of Rs.49.80 lakh and Rs.10.80 lakh made against a taxpayer after finding that her investment in a new flat and cash deposits were wrongly treated as unexplained, despite being traceable to the sale of her earlier property and household items. A bench of Judicial Member Aby T. Varkey and Accountant Member S.R. Raghunatha held, “We thus find that the addition made by the AO u/s 69A was without any basis and on...

Revised IT Return Permissible Only For Bona Fide Discovery Of Omission Or Mistake: Gujarat High Court

The Gujarat High Court on 9 April, held that a taxpayer can file a revised return under Section 139(5) of the Income Tax Act, 1961 only when it discovers a bona fide omission or wrong statement in the original return filed under Section 139(1). The provision cannot be used to make deliberate or afterthought changes. The Bench of Justices A.S. Supehia and Pranav Trivedi emphasised that a valid revised return replaces the original return for all purposes under the Act, but only when it reflects...

Delay In Final Approval Filing Not Adverse Where Caused By Confusion In Amended Law: ITAT Ahmedabad

The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT), has held that delay in filing an application for final approval cannot be held against a taxpayer where such delay arises due to genuine confusion created by newly amended statutory provisions and procedural uncertainty during the transition period.The Bench comprising Judicial Member Sanjay Garg and Accountant Member Annapurna Gupta while dealing with the case of Navsarjan Education Trust, observed that both taxpayers and tax...

Gujarat High Court Sets Aside Move For Income Tax Reassessment In Land Sale, Bars Differing Stand On Evidence

The Gujarat High Court has set aside a tax reassessment notice issued in a land sale case, holding that the Income Tax Department cannot rely on the same evidence to take opposite positions against the buyer and the seller.The Division Bench comprising Justice A.S. Supehia and Justice Pranav Trivedi was dealing with a writ petition challenging a notice issued under Section 148 of the Income Tax Act for Assessment Year 2020–21.The case arose from a search conducted under Section 132 of the Income...

Gujarat High Court Quashes Move To Reopen Income Tax Assessment Over Vague Third-Party Material

The Gujarat High Court has quashed reassessment notices against a taxpayer, ruling that the Income Tax Department cannot reopen completed assessments based on vague third-party documents that have no clear link to the person concerned.The ruling was delivered by a Division Bench comprising Justice A. S. Supehia and Justice Pranav Trivedi in a batch of petitions led by Bhavnaben Darshanbhai Patel, challenging reassessment proceedings for Assessment Year 2020–21.The case arose after a search under...

Writ Maintainable After Income Tax Assessment If Order Is Ex Facie Without Jurisdiction: Delhi High Court

The Delhi High Court has held that a writ petition under Article 226 is maintainable even after completion of assessment proceedings, where the impugned action is ex facie without jurisdiction.A Division Bench of Justices Dinesh Mehta and Vinod Kumar observed that “simply because the proceedings have culminated into an assessment order, the petitioner cannot be made to suffer the agony of an order which is without jurisdiction on the face of it, until the appellate authority does a formal act of...