Income Tax Appellate Tribunal Overturns Tax Assessment, Mandates Fresh Evaluation of Expense Claims Under Section 250(6)

ITAT allowed the appeal, setting aside both AO and CIT(A) orders due to procedural irregularities. The appellate authority failed to adjudicate issues on merits as mandated under Section 250(6), and the AO made additions without substantive inquiry into expense claims. The tribunal found no specific defects in the assessee's expense documentation and determined that neither the assessment order nor the appellate order was legally sustainable. The matter was remanded to the AO for a de novo assessment, with the appeal allowed for statistical purposes, ensuring a comprehensive re-examination of the original expense claims and proportionate calculations. .....

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