Tribunals and Commissions judgments

ITAT Amritsar ruled that an ex parte order is invalid if notices are sent to an incorrect email ID, violating principles of natural justice. The tribunal remanded the case for fresh hearing, imposing a token cost on the assessee for negligence, while emphasizing proper service of notice as a fundamental right in tax appeals.

ITAT Bangalore reaffirms judicial discipline in tax proceedings by holding that under Section 254 of the Income Tax Act, only the Assessing Officer (AO) can be directed to reconsider matters. Directions to the Dispute Resolution Panel (DRP) or Transfer Pricing Officer (TPO) are ultra vires, reinforcing the statutory hierarchy in transfer pricing disputes.

ITAT Amritsar rules that assessees cannot raise limitation objections under Section 148 for the first time before the tribunal, as such challenges must be adjudicated earlier. The tribunal imposed costs for procedural non-compliance, emphasizing strict adherence to appellate hierarchy in tax litigation.

NCLAT rules that the Committee of Creditors (CoC) cannot proceed with voting on a resolution plan if a creditor's claim dispute remains unresolved. This ensures procedural fairness and protects creditor rights under the Insolvency and Bankruptcy Code, preventing prejudice to disputing creditors.

CESTAT rules that penalties under Rule 26 of the Central Excise Rules, 2002 cannot be imposed without establishing the assessee's knowledge or reasonable belief of confiscation liability. The tribunal emphasized that show cause notices must explicitly allege mens rea, failing which penalties are unsustainable. This ruling reinforces due process protections for businesses dealing with excisable goods.

CESTAT Chennai rules that renting immovable property for residential use-even if leased to a company and occupied by its managing director-falls under the statutory exemption from service tax under Section 65(105)(zzzz) of the Finance Act. The ruling clarifies that the nature of use, not the lessee’s identity, determines tax liability, offering relief to property owners and corporate lessors.

ITAT Bangalore sets aside a ₹32.69 crore disallowance under Section 40(a) for failure to specify the exact TDS provision violated. The ruling mandates procedural clarity, requiring tax authorities to identify the precise legal basis for disallowance before penalizing assessees.

ITAT Mumbai condones a 3-year delay in filing an income tax appeal, ruling that lack of digital access, education, and non-receipt of notices constitute sufficient cause under Section 253. The tribunal directs a fresh assessment, emphasizing equity over procedural rigidity for assessees in rural or digitally disadvantaged settings.

NCLAT rules that unverified WhatsApp screenshots and unfiled lab reports cannot establish a pre-existing dispute under Section 9 of the Insolvency and Bankruptcy Code. The ruling clarifies that operational creditors must provide credible, documented evidence to defeat insolvency petitions, impacting debt recovery strategies for businesses.

ITAT Delhi rules that contractual receipts reflected in Form 26AS are taxable in the year of receipt if the taxpayer fails to prove deferral under the accrual or completed contract method. The ruling shifts the burden of proof to the assessee to justify deferral, impacting tax assessments for businesses with disputed or unrecognized revenue.

ITAT Pune rules that once the assessee establishes the identity, capacity, and source of the source of funds (e.g., sale of promoter shares), Section 68 cannot be invoked to treat legitimate capital gains as unexplained cash credits. This safeguards taxpayers from arbitrary recharacterization of income where the transaction trail is transparent.

CESTAT clarifies that excise duty liability under Section 3 of the Central Excise Act rests with the job worker undertaking actual manufacturing, not the principal supplying raw materials. The ruling shields principals from duty demands where job workers avail area-based exemptions, impacting contract manufacturing agreements across industries.

CESTAT rules that sub-contractors providing exempted works contract services to government authorities remain eligible for service tax exemption under Notification No. 25/2012, even if payments are routed through a sister concern. The ruling clarifies that the exemption hinges on the nature of the service, not the payment channel, offering relief to sub-contractors in similar arrangements.

ITAT Nagpur rules that a taxpayer’s deduction under Section 35(1)(ii) of the Income Tax Act cannot be disallowed merely because the research institution’s approval was cancelled after the donation was made. The ruling reinforces statutory protection for taxpayers relying on valid approvals at the time of donation, preventing retrospective disallowance of legitimate claims.

NCLAT rules that a recovery certificate issued against a principal borrower triggers a fresh three-year limitation period for financial creditors to initiate CIRP against corporate guarantors. This holding clarifies the interplay between debt recovery mechanisms and IBC timelines, impacting asset reconstruction companies and lenders pursuing guarantor liability.

CESTAT ruled that excise demands are unsustainable if Panchnamas are unverified or Section 14 statements remain unexamined, reinforcing strict adherence to procedural standards under the Central Excise Act. The judgment underscores that evidentiary compliance is non-negotiable for adjudication, impacting manufacturers and revenue authorities alike.

CESTAT Chennai rules that Central Excise authorities lack jurisdiction to challenge Customs classification of imported software, as CVD/SAD credit cannot be treated as excise duty. The ruling protects importers from retrospective demands based on disputed classifications, reinforcing the finality of Customs assessments.

ITAT Delhi quashed an ex-parte dismissal of an income tax appeal for non-compliance with mandatory notice under Section 250(2)(a), holding that natural justice principles require a hearing opportunity before adjudication. The Tribunal directed fresh proceedings, emphasizing that appellate authorities must adhere to procedural fairness even in faceless appeals.

CAT Principal Bench holds that an 11-year delay in initiating disciplinary proceedings against an ICAS officer is justified by an ongoing CBI investigation, dismissing the petition to quash the charge memo. The ruling reinforces that investigative complexities can excuse procedural delays, impacting government employees facing disciplinary actions.

ITAT Mumbai quashed reassessment proceedings under Section 147 of the Income Tax Act initiated after four years, ruling that the absence of new tangible material or failure to disclose material facts invalidates such actions. The decision reinforces statutory safeguards against arbitrary reopening of assessments, impacting taxpayers facing similar reassessment notices.

NGT Eastern Zone stayed Assam’s order diverting 1,600 forest personnel for election duties, holding it violates the Biological Diversity Act, 2002 and Supreme Court directives on forest protection. The ruling underscores statutory obligations to prioritize biodiversity conservation over administrative exigencies, setting a precedent for safeguarding ecological duties during electoral deployments.

ITAT Kolkata quashes addition under Section 69A where the Assessing Officer relied on mere arithmetic differences without examining supporting documents. The ruling reinforces that unexplained credits must be analyzed contextually, not just numerically, to uphold natural justice in tax assessments.

CESTAT Hyderabad rules that under Free-On-Rail (FOR) contracts, freight and insurance charges form part of the assessable value for Central Excise Duty when the sale concludes at the buyer’s premises. This decision sets a precedent for excise valuation, impacting manufacturers and suppliers under similar contractual terms.

The NCLAT has ruled that a company’s statutory duty to repay matured deposits under Section 74 cannot be suspended due to succession disputes or pending probate proceedings. The obligation to return deposits is absolute and must be honored, with assets held in trust for the estate until legal succession is determined - protecting depositors’ rights regardless of the deceased’s estate complexities.