Protective Addition Cannot Stand Once Substantive Addition is Settled in the Hands of Others 1. The Legal Conflict The core dispute involved the taxability of entries found in “Diary No. SGF-XIV” impounded during a survey at the premises of the assessee society. Substantive Addition: The Assessing Officer (AO) added the amounts found in the diary… Read More »

ITAT Chandigarh: Royalty/Commission Paid Between Milk Cooperative Societies Held Legitimate Business Expenditure 1. The Dispute: Commission vs. Royalty The core issue across several years was the disallowance of payments made by the Ropar District Cooperative Milk Producers Union to other milk unions (Patiala, Hoshiarpur, and the Punjab State Federation). The Payment: The assessee paid amounts… Read More »

Presumptive Taxation u/s 44AD Overrides Unexplained Cash Credit Addition on Turnover 1. The Core Dispute The primary issue was whether the Assessing Officer (AO) can treat a portion of the business turnover as an “Unexplained Cash Credit” under Section 68 when the assessee has opted for the Presumptive Taxation Scheme under Section 44AD. 2. The… Read More »

Compensation for Agricultural Land vs. Interest: ITAT Remands Matter for Fresh Verification 1. The Core Dispute The case involved three primary tax issues arising from a reassessment under Section 147: Exempt Compensation: Whether the amount of ₹9,01,726 received was actual land compensation (exempt under Section 10(37)) or “Income from Other Sources.” Interest on Compensation: The… Read More »

Presumptive Income u/s 44AD Accepted: ITAT Deletes Demonetization Cash Addition 1. The Core Dispute The primary issue was the taxability of ₹12.34 Lacs in cash deposited by the assessee in old currency during the 2016 demonetization period. AO’s Action: The AO framed a “Best Judgment Assessment” u/s 144, rejecting the assessee’s claim of running a… Read More »

ITAT Sets Aside Addition for Stamp Duty Value Difference Due to Procedural Lapses 1. The Core Dispute: Section 56(2)(vii)(b) Addition The primary grievance of the assessee was an addition of ₹48,00,000 made by the Assessing Officer (AO). The Legal Point: Under Section 56(2)(vii)(b), if an individual or HUF purchases a property for a consideration that… Read More »

Revenue Authority Challenge to CIT(A) Remand Power Dismissed: ITAT Upholds New Section 251(1)(a) Authority The Issue The Revenue (Income Tax Department) appealed against an order by the CIT(Appeals), NFAC, which had set aside a “Best Judgment Assessment” and remanded the case back to the Assessing Officer (AO) for fresh adjudication. The Revenue argued that: The… Read More »

Reassessment Order Quashed and Remanded: ITAT Sets Aside Ex-Parte Decision on Unexplained Property Investment 1. The Core Issue The assessee challenged a reassessment order where an addition of ₹67,60,000 was made under Section 69 of the Income Tax Act. The addition was based on alleged unexplained investments made in the purchase of a property during… Read More »

ITAT Sets Aside Rejection of Section 12A/80G Registration for Section 8 Company The Issue The Commissioner of Income Tax (Exemptions), Chandigarh rejected the application of a newly incorporated Section 8 company for regular registration under Section 12A(1)(ac)(iii) and approval under Section 80G. The CIT(E)’s Reasoning: The applicant stated that its charitable activities “commenced in March… Read More »

ITAT Sets Aside Rejection of Section 12A/80G Registration for Section 8 Company 1. The Core Dispute The Commissioner of Income Tax (Exemptions), Chandigarh rejected the application of a Section 8 company (incorporated in January 2024) for regular registration under Section 12A(1)(ac)(iii) and approval under Section 80G. The CIT(E)’s Reasoning: The applicant stated that its charitable… Read More »