'Estimation Theory Doesn't Apply To Sham Purchases': ITAT Mumbai Restores Full Disallowance Of ₹26.49 Lakh

The Income Tax Appellate Tribunal (ITAT) Mumbai has held that where purchases are conclusively proven to be bogus and the assessee fails to substantiate the genuineness of suppliers, the entire purchase amount must be added to income and the benefit of estimating profit element cannot be applied. A Bench of Smt. Beena Pillai (Judicial Member) and Shri Omkareshwar Chidara (Accountant Member) was hearing a Revenue appeal against the order of the CIT(A) which had restricted disallowance of...

Income Tax Act | ITAT Delhi Grants Relief In S.10(10D) Dispute; AO Directed To Reassess ULIP Maturity Proceeds Treated as Unexplained Investment

The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has remitted back the addition of capital gains deduction to the Assessing Officer (AO) for fresh adjudication in absence of a remand report despite repeated reminders.The Bench, comprising Mr. Mahavir Singh (Vice President) on the claim of assessee that income was an exempt income for being a sum received under life insurance policy noted AO's failure to furnish remand report. “It is noted that Ld. CIT(A) has admitted the additional...

Transfer Pricing Officer Cannot Cherry-Pick Transactions When Transactional Net Margin Method Is Accepted: ITAT Mumbai

The Income Tax Appellate Tribunal (ITAT) Mumbai has held that once the Transactional Net Margin Method (TNMM) is accepted for benchmarking all international transactions, the Transfer Pricing Officer (TPO) cannot cherry-pick only the management fee and assign an Arm's Length Price (ALP) at NIL. In the case in hand, the assessee had preferred an appeal before the ITAT seeking deletion of the Transfer Pricing adjustment on management fees and the consequential enhancement of income, being...

Refund Of Capital Advance From Karta To HUF Is Capital Receipt; Commercial Use Of Capital Does Not Convert It Into Income: ITAT Mumbai

On November 17th, 2025 the Bench of Shri Vikram Singh Yadav (Accountant Member) and Shri Sandeep Singh Karhail (Judicial Member) of the ITAT Mumbai partly allowed the appeal holding that the disallowance under Section 14A (Expenditure for exempt income) r/w Rule 8D cannot exceed the actual expenditure of ₹69,455 incurred by the assessee, and that the excess refund of ₹1,26,32,970 received on return of capital advance retained its character as a capital receipt and could not be taxed as...

Aishwarya Rai Bachchan Gets Relief From ITAT Mumbai; ₹4.6 Crore Disallowance U/S 14A Income Tax Act Deleted As 'Unreasonable'

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has deleted Rs. 4.6 Crore disallowance made under Section 14A Income Tax Act, against Aishwarya Rai Bachchan in a high-profile income tax case. Section 14A of the Income Tax Act, 1961 has prescribed a method for determining the expenditure incurred towards earning exempt income under Rule 8D by the income tax officer. The case was heard by bench comprising of Pawan Singh (Judicial Member) and Renu Jauhri (Accountant...

Mumbai ITAT Quashes ₹445 Crore Transfer Pricing Adjustment Against Netflix India

The Income Tax Appellate Tribunal (ITAT) Mumbai has recently set aside a Rs 445 crore transfer pricing adjustment on Netflix India for financial year 2021-22, rejecting the Revenue's claim that the company, as a licensee of its streamed content, owed higher taxes.The authorities had imposed the tax because they treated Netflix India, the Indian arm of US-based streaming giant Netflix, as a licensee of Netflix US's intellectual property. They claimed the company owed deemed royalty and license...

Assessment Order Not Void Solely Because It Was Passed in Deceased's Name: ITAT Chandigarh

The Income Tax Appellate Tribunal (ITAT), Chandigarh Bench, recently held that an appellate order passed by the Commissioner of Income Tax (CIT), reassessing the income tax liability of an assessee, is not invalid merely because it was issued in the name of a deceased person. The Tribunal noted that since the appeal itself was filed under the deceased's name, the order cannot be quashed on that ground alone.Judicial Member Laliet Kumar and Accountant Member Manoj Kumar Aggarwal observed, “since...

Sale Proceeds Of Minor's Property Share Deposited Under Court Order Excluded From Father's Taxable Income: ITAT

The Chennai Bench of Income Tax Appellate Tribunal (ITAT) has stated that sale proceeds of a minor's property share deposited under court order are excluded from father's taxable income. S.S. Viswanethra Ravi (Judicial Member) held that the assessee cannot decide the utilization of his minor daughter's share as it is deposited as per Court's order and it is impossible to club the same in the assessee's (father) hand. In this case, the assessee filed return of income in response...

Assessee Cannot Be Asked To Prove Non-Occurrence Of Transaction Once Documentary Evidence Is Produced: ITAT

LThe Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has stated that the assessee is not required to prove negative once documentary evidence is produced.Section 69C of the Income Tax Act, 1961 provides that if an assessee incurs any expenditure during a financial year and fails to provide a satisfactory explanation, or if the Assessing Officer does not accept the explanation, the amount of such expenditure may be treated as the assessee's deemed income for that year.Amit Shukla (Judicial...

Wedding Gifts Can't Be Automatically Treated As 'Unexplained Income' Without Evidence: ITAT

The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) has stated that wedding gifts can't be automatically treated as unexplained income without evidence. Dr. BRR Kumar (Vice President) and Siddhartha Nautiyal (Judicial Member) stated that the fact that marriage gifts were received prior to the date of marriage itself could not lead to the conclusion that the same are not genuine, when a complete lists of persons from whom the gifts were received was duly submitted during the...

Property Transfer Between Spouses Without Actual Consideration Not Taxable As Capital Gains: ITAT

The New Delhi Bench of Income Tax Appellate Tribunal (ITAT) has stated that property transfer between spouses without actual consideration is not taxable as capital gains. S. Rifaur Rahman (Accountant Member) and Anubhav Sharma (Judicial Member) were dealing with the issue arises out of addition of Rs. 1,40,00,000/-, being consideration amount mentioned in conveyance deed, executed by late Sunil Kumar, as received, from his wife Bimila Devi, who was alleged purchaser. The ...

Income Tax Act | Rebate U/S 87A Available On Short-Term Capital Gains U/S 111A Under New Regime: ITAT

The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) has stated that rebate under section 87A available on short-term capital gains under section 111A under new regime. Suchitra R. Kamble (Judicial Member) and Makarand V. Mahadeokar (Accountant Member) stated that on a plain reading of the statutory provisions, there exists no express bar either in section 87A or section 111A for denial of rebate in respect of tax payable on short-term capital gains arising from transfer of...