ACIT CIRCLE-45(1), NEW DELHI V. VIBHA TANEJA, NEW DELHI

ITA 946/DEL/2020

AI Insights

The case involves an appeal by the Assistant Commissioner of Income Tax (ACIT) against Vibha Taneja concerning the assessment year 2016-17. The primary issues revolved around the additions made by the AO regarding unexplained cash credits and the source of cash deposits in bank accounts. The AO had made substantial additions to the income of the assessee, which were later contested and partly allowed by the CIT(A). The Revenue's appeal to the Tribunal challenged the CIT(A)'s decision to delete these additions. The Tribunal examined the procedural compliance and the substantive evidence provided, ultimately dismissing the Revenue's appeal and upholding the CIT(A)'s decision.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 837352 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 11 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2026
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2016-2017
• Appeal Filed On: 02-03-2020
• Other Referred Cases: P. K. Sethi vs. CIT, M/s Jalan Timbers vs. CIT, CIT vs. Diamond Products Ltd., M/s Monnet Ispat & Energy Ltd. vs. Dy. CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: TARANDEEP SINGH
• Keywords: Additional evidence; Unexplained cash credit; Assessment record
• Section: 143(3); 142(1)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘A’: NEW DELHI BEFORE SHRI VIMAL KUMAR, JUDICIAL MEMBER AND SMT. RENU JAUHRI, ACCOUNTANT MEMBER ITA No.946/Del/2020 (ASSESSMENT YEAR 2016-17) Asst. CIT, Circle-45(1), New Delhi. Vs. Vibha Taneja, R 01B, 3rd Floor, TDI Mall, Shivaji Place District Centre, Rajouri Garden, New Delhi-110027. PAN-AAFPT1050J (Appellant) (Respondent) Assessee by Shri Tarandeep Singh, FCA Department by Shri Ajay Kumar Arora, Sr. DR Date of Hearing 22.01.2026 Date of Pronouncement 20.02.2026 O R D E R PER VIMAL KUMAR, JM: This appeal filed by the Revenue is against order dated 10.12.2019 of the Learned Commissioner of Income Tax (Appeals)-15, New Delhi [hereinafter referred to as ‘the Ld. CIT(A)’] passed u/s 250 of the Income Tax Act, 1961 [hereinafter referred to as ‘the Act’) arising out of assessment order dated 14.12.2018 passed by the Ld. Assistant Commissioner of Income Tax, Circle-45(1), Delhi [hereinafter referred as ‘the Ld. AO’] for Assessment Year 2016-17. 2. Brief facts of the case are that the assessee filed return of income on 13.02.2017 at income of Rs.16,56,930/-. The case of the assessee was selected for scrutiny under CASS on the issue whether cash deposits in SB Accounts have been made out of disclosed sources and whether investment and income relating to Printed from counselvise.com 2 ITA No.946/Del/2020 ACIT vs. Vibha Taneja properties are duly disclosed. Notice u/s 143(2) was issued on 18.09.2017. The assessee did not make any compliance. Notice u/s 142(1) dated 01.02.2018, 06.08.2018, 05.09.2018 and 04.10.2018 were issued but the assessee failed to make compliance. Penalty of Rs.10,000/- was imposed u/s 271(1)(b) vide order dated 04.10.2018 for non-compliance of notice u/s 142(1) dated 06.08.2018. The Ld. Counsel of the assessee filed online response on 12.10.2018. Notice u/s 142(1) dated 16.10.2018 was issued seeking the source of cash deposit of Rs.28,95,000/- and Rs.22,50,000/- made in the two HDFC bank accounts as also the evidence of creditworthiness of Sh. Akash Taneja and Sh. Pawan Taneja. The assessee uploaded ITR of Sh. Akash Taneja and his PAN on 22.10.2018. The assessee filed replies on 22.10.2018, 03.11.2018 and 13.11.2018. Notice u/s 142(1) dated 26.11.2018 was issued. The counsel of the assessee filed written submissions online on 03.12.2018. Another notice u/s 142 dated 05.12.2018 was issued. On completion of proceedings, the Ld. AO vide order dated 14.12.2018 made additions of Rs.18,45,000/-, Rs.11,12,500/- or Rs.1,43,94,000/-. 3. Against order dated 14.12.2018 of Ld. AO, the assessee filed appeal before the Ld. CIT(A) which was partly allowed vide order dated 22.10.2019. 4. Being aggrieved, the Revenue preferred the present appeal on following grounds: “1. Whether on facts and circumstances of the case, the CIT(A) has erred on facts in deleting the addition of Rs.18,45,000/- made by the AO. 2. Whether on facts and circumstances of the case, the CIT(A) has erred on facts in deleting the addition of Rs.11,12,500/- made by the AO. 3. Whether on facts and circumstances of the case, the CIT(A) has erred on facts in deleting the addition of Rs.1,38,00,000/- made by the AO.” Printed from counselvise.com 3 ITA No.946/Del/2020 ACIT vs. Vibha Taneja 5. Ld. Departmental Representative for the appellant submitted that the Ld. CIT(A) erred in deleting additions of Rs.18,45,000/-, 11,12,5000/- and 1,38,00,000/- made by Ld. AO. 6. The Ld. Authorized Representative for respondent assessee submitted that the Ld. AO passed assessment order dated 14.12.2018 despite the fact that notice u/s 142(1) dated 05.12.2018 gave date for compliance as 20.12.2018. Ld. CIT(A) on basis of evidence deleted the additions. 7. From the examination of record in light of aforesaid rival contention, it is crystal clear that Ld. CIT(A) in paras 4.1 to 4.4.3 held as under: “4.1 The appeal is against order passed u/s 143(3) by ACIT Circle 45(1) on a total income of Rs.1,90,08,430/- as against income returned at Rs. 16,56,930/-. The AO made total addition of Rs. 1,73,51,500/- on account of several unexplained cash credits. An addition of Rs. 18,45,000/- was made on account of unexplained cash credit in HDFC account even though as per AR, the source of credit had been explained as being out of self-cash withdrawals. Further, addition of Rs. 11,12,500/- was made being half of alleged unexplained cash credit in the joint account with Sh. Pawan Taneja even though the appellant's name was for either or survivor. The AO made another addition of Rs. 1,43,94,000/- on account of unexplained cash credit, being loan received from son Sh. Akash Taneja on the ground that the entries of deposits made in the accounts of Sh. Akash Taneja were not acceptable. 4.2 During the course of appellate proceedings, the AR of the appellant filed written submissions dated 09.05.2019 along with additional evidences u/R 46A. The main plea of the AR of the appellant was, \"The appellant received notice u/s 142(1) dated 05.12.2018 fixing hearing on 20.12.2018 at 11A.M. However, it is found that the order of assessment was passed on 14.12.2018. The appellant could not filed any reply for this reason. The appellant had not been granted proper and meaningful opportunity and as such, it was prevented by sufficient cause from producing such evidence during the course of the assessment.\" 4.3 Accordingly, the submissions made by the AR were sent for the remand report of the AO. The remand report of the AO was received on 31.05.2019 vide AO's letter dated 27.05.2019. The relevant portion of the remand report is reproduced below: After perusing the contention of counsel of assessee it was observed that the additional evidences were filed in respect of sale of shares by Sh. Akash Printed from counselvise.com 4 ITA No.946/Del/2020 ACIT vs. Vibha Taneja Taneja and the copy of loan account of Sh. Akash Taneja with M/S: India Infoline Housing Finance Limited (hereinafter referred to as IIFL). It is further submitted that as regards evidence of Sale of share of Rs.5,94,000/- by Sh. Akash Taneja, the counsel has enclosed a certificate from NFL showing a pay out of Rs. 6,60,681/-dt: 07/04/2015. And the credit entries in the A/c of Sh. Akash Taneja on 07/04/2015 and 08/04/2015 also totaled to Rs.6,60,000/-. Thus credence can be lent to the contention of counsel to this extent. However as regards loan of Rs. 1,75,00,000/- received by Sh. Akash Taneja from M/S: IIFL to further lend a loan of Rs 1,38,00,000 to the assessee Smt. Vibha Taneja is concerned, the reply filed by the counsel is evasive and the evidence filed does not corroborate the contention of counsel. The Amortization schedule of loan received by Sh. Akash Taneja shows the loan amount at Rs.2,02,00,000/- with seven co borrowers including the assessee Smt. Vibha Taneja. This loan has nowhere been seen credited into the bank account of Sh Akash Taneja and the credit entry of Rs. 1,75,00,000/- on 25/06/2015 seen in the HDFC bank A/c or bh Akash | aneja is having description Lheq dep. LL(J Noida contrary to the amount or loan ot / Rs 2,02,00,000 raised from M/S: IIFL having date of commencement as 05/07/2015. Thus the credit of amount of Rs 1,75,00,000 in the bank account of Sh Akash Taneja occurred a little before the raising of loan from M/S: IIFL Thus there is no correlation between credit of Rs 1,75,00,000 in the bank account of Sh Akash Taneja and the alleged loan raised by him from M/S: IIFL. The assessee has utilised the credit entries received from other sources, the details of which were never filed before the undersigned. Thus the additional evidence filed with regard to loan from M/S: IIFL has no evidentiary value so far as the source of investment in the purchase of immovable property by the assessee Smt Vibha Taeja was concerned. And therefore it is requested that the same should to be rejected at the outset. 4.4 The contentions of the AR have been considered and the order of the AD has also been perused. In the rejoinder filed by the AR dated 26.07.2019, the AR of the appellant has made the submissions on all the issues, on which the AO has made the addition. These are discussed below: 4.4.1 As regards the addition of Rs. 18,45,000/-, it is submitted by the AR that the addition was made on account of alleged unexplained cash credit in HDFC account even though the source of credit had been explained as being out of self- cash withdrawals. It was explained before the AO that the cash deposits exceeded the cash withdrawals, but the same was not accepted by the AO without any valid reasons. As per the AO, the confirmation from bank regarding persons who made withdrawal l.e. by herself or by any bearer was not received. In absence of confirmation regarding withdrawal by herself or bearer, the AO made the above addition. Printed from counselvise.com 5 ITA No.946/Del/2020 ACIT vs. Vibha Taneja It is submitted by the AR that the AO has accepted the fact that the cash deposits were more than cash withdrawals. There were total withdrawal of Rs.31,05,000/- and there was total deposit of Rs.22,50,000/- in the account. The AO has accepted only cash withdrawal by ATM but has disbelleved other cash withdrawals by cheque. On this basis, the AO made addition of Rs.18,45,000/-. The fact that the appellant went herself to make withdrawal or whether it was withdrawn by bearer does not make the withdrawal as unacceptable. Withdrawal of cash by ATM or by going herself to the bank or by sending someone to the bank is the same. All three are different modes of making cash withdrawal and AO cannot force an assessee to adopt only ATM withdrawal for withdrawing cash. There was no valid basis for the AO to reject methods of cash withdrawal and in making the addition. When there was adequate cash deposits to explain cash withdrawals, there could be no reason to make addition. Therefore, considering the facts and circumstances of the case, the action of the AO is not tenable and accordingly the addition of Rs.18,45,000/- made by the AO is hereby deleted. 4.4.2 The next issue is in regard to addition of Rs.11,12,500/- being half of unexplained cash deposit in the joint account of the appellant with Sh. Pawan Taneja, her husband. The bank account is in the name of Sh. Pawan Taneja and appellant is jointly holding the account as either or survivor. Sh. Pawan Taneja is actually operating the account. However, the AO required the appellant to furnish the details of the joint account and the appellant filed details as per the AO's requirement. It was observed by the AO that there were cash deposits of Rs. 28,95,000/- out of which cash withdrawals of Rs. 6,70,000/- was considered as explained. The AO accepted only cash withdrawal of ATM and as regards the other cash withdrawals, the AO wanted confirmation from the bank as to whether it was withdrawn personally or by bearer. The AO considered the entire amount of Rs. 22,25,000/- as unexplained. The AO made addition of Rs. 11,12,500/- being half of the amount on the ground of that appellant was joint holder of account. It is submitted by the AR that though the account was in the joint name, it was being operated by Sh. Pawan Taneja her husband and if any enquiry was to be made, it should have been made in case of Sh. Pawan Taneja and not in her case. The copy of the joint account (submitted during the appellate proceedings) shows opening balance of Rs. 19,95,808/-. There are cash withdrawals of Rs. 31,31,000/-. The cash deposits are of Rs. 28,95,000/- and thus is adequately covered by the cash withdrawals of Rs. 31,31,000/-. The action of the AO of considering only ATM withdrawal as explained and other cash withdrawals by cheque as unexplained is beyond comprehension. The fact that the appellant went herself to make withdrawal or whether it was withdrawn by bearer does not make the withdrawal as unacceptable. Withdrawal of cash by ATM or by going herself to the bank or by sending someone to the bank is the same. All three are modes of cash withdrawal and AO cannot force an assessee to adopt only ATM withdrawal for withdrawing cash. There was no valid basis Printed from counselvise.com 6 ITA No.946/Del/2020 ACIT vs. Vibha Taneja for the AO to reject methods of cash withdrawal and in making the addition. When there was adequate cash deposits to explain cash withdrawals, there could be no reason to make addition. It is, therefore, submitted that the addition made be deleted. I have considered the arguments raised on behalf of the appellant. It was a joint account operated by her husband and ought to have been examined in his case. Further cash deposits were more than cash withdrawals. The rejection on the basis of withdrawal by cheque or by cheque cannot be basis of treating credits as unexplained cannot be accepted as discussed in the earlier paras. Therefore, considering the facts and circumstances of the case, the addition made of Rs. 11,12,500/- is, hereby deleted. 4.4.3 Next issue is in regards to addition of Rs. 1,43,94,000/- on account of unexplained cash credit out of deposits made in the accounts of Sh. Akash Taneja. The AO noticed that there was deposit of Rs. 1,38,00,000/- in the account of appellant. The deposit was explained as being out of loan of Rs. 1,75,00,000/- by his son Akash Taneja. As per the AO there was also entry of Rs. 5,94,000/- in the account of the appellant, which was received from Sh. Akash Taneja. The explanation that it was out of receipt of sale of share was considered by the AO as unexplained. As per the AO no evidence of loan of Rs.1,75,00,000/- received from India Infoline Housing was furnished and the AD made addition of Rs. 1,43,94,000/- being sum of Rs. 1,38,00,000/- and 5,94,000/- received from her son. It was argued on behalf of the appellant that Sh. Akash Taneja was IT assessee and the AO could have made enquiry with him. Although, the assessee furnished the details of accounts of her son Sh. Akash Taneja but the AO did not make any enquiry in his case and made addition in case of the appellant. The appellant filed an application under rule 46A for furnishing evidence for sale of share by Sh. Akash Taneja and loan taken by Sh. Akash Taneja from India Infoline Housing Finance Limited. In the remand report the AO has accepted the evidence for sale of share and therefore the addition made of Rs. 5,94,000/- does not survive and is deleted hereby. As regards the loan of Rs. 1,75,00,000/- received by Sh. Akash Taneja, it was submitted by the appellant that the AO had disbelieved the entry on the ground that the description of the entry made in the accounts of Sh. Akash Taneja showing \"Cheq dep. CLG Noida\". As per the AO, the deposit of cheque in the account of Sh. Akash Taneja is on 25.06.2015 while the loan account from M/s IIFL shows date of commencement of loan 05.07.2015. As per the remand report, there was no correlation between credit of Rs. 1,75,00,000/- in the bank account of Sh. Akash Taneja and the alleged loan from M/s IIFL. It was submitted by the appellant that the AO could have verified from the bank about the credit entry by cheque in the bank account of Sh. Akash Taneja and from where it had come, while furnishing the remand report. Further, the appellant had submitted copy of loan account from M/s IIFL, which clearly shows it is a home loan. The loan Printed from counselvise.com 7 ITA No.946/Del/2020 ACIT vs. Vibha Taneja of Rs. 2,02,00,000/- given to Sh. Akash Taneja and loan account shows the address of M/s IIFL as under: India Infoline Housing Finance Limited. 12A-10, 13th floor, Parinee Crescenzo C-38 and C-39, G Block, Behind MCA Bandra Kurla Complex, Bandra East, Mumbai-400051 It was submitted by the appellant that the AO had not made any effort to make enquiry from M/s IIFL regarding loan given. As regards the date of 05.07.2015 shown for commencement of loan repayment, it is obvious that loan of Rs. 2,02,00,000/- had already been given to Sh. Akash Taneja. Sh. Akash Taneja had shown Rs.1,75,00,000/- as received on 29.06.2015 and there was no reason to disbelieve it. In any case, the appellant had already explained that the loan of Rs. 1,38,00,000/- was taken from Sh. Akash Taneja and Sh. Akash Taneja had sufficient funds to advance loan. The fact that Sh. Akash Taneja had received Rs. 1,75,00,000/- by cheques was also proved by the appellant. The onus of the appellant has already been discharged. The AO had been given sufficient proof but AO did not make any further enquiry whatsoever from the bank of Sh. Akash Taneja or from M/s IIFL whose address was already on the records of the AO in the copy of loan account furnished by the appellant. In case of P. K. Sethi vs. CIT (2006) 286 ITR 318 (Gau.) It was held by the Hon'ble High Court that the Identity of the creditor is proved when a creditor is shown to be an Income tax assessee. When the amount were shown as withdrawn from the accounts available and were paid by account payee cheques, the transaction was held to be genuine. In this case the genuineness of transaction was doubted in case of five creditors whose accounts were opened within a short period. Since there was no other material brought on record by the Department it was held by the Hon'ble High Court that the transaction was genuine. In case of M/s Jalan Timbers vs. CIT 223 ITR 11 (Gau.), the Hon'ble High Court observed as under:- \"It is true that by proving the identity, the assessee cannot be said to have discharged its onus. In the instant case, the amounts were shown in the income-tax return of the assessee. Besides, the creditors had also shown in the returns about the giving of the loan to the assessee. Strangely, the Income-tax Officer while making the assessment in respect of the three creditors above named accepted the returns. This itself will go to show that the amount received by the assessee was at least prima facie genuine. As the Income-tax Officer had accepted the returns of the three creditors It should go to mean that the amounts given by those creditors were also genuine. On going through the Tribunal's judgment, we find that the Tribunal observed thus: \"Of course, confirmation. letter was filed but in the instant case, the Income-tax Officer went further and verified the assessment records of that creditor from which he found Printed from counselvise.com 8 ITA No.946/Del/2020 ACIT vs. Vibha Taneja various facts as mentioned in the assessment order and as discussed by us above. Thus, in our opinion, identity of the creditor alone is not sufficient. It has also to be shown that the creditor had the capacity to advance the loan and that the loan itself was genuine.\" The Tribunal, however, did not make any endeavour to give any cogent reason why the income-tax returns filed by the creditors and accepted by the Income-tax Officer should be ignored. In our view, the assessee had at least proved its case. Accordingly, we answer the three questions in the negative, l.e., against the Revenue and in favour of the assessee.\" Thus where return of income is filed by the creditor of the assessee and is accepted by the Department, the genuineness of the transaction cannot be doubted In case of M/s Monnet Ispat & Energy Ltd. vs. Dy. CIT (2008) 171 Taxmann 27 (Delhi) it was found that the share application money was received by banking channel and that the assessee had produced confirmatory letters. The creditor was assessed to tax and the PAN had been given in the certificate filed. It was held by the Hon'ble Delhi High Court that the assessee had completely discharged the identity of the creditor, creditworthiness and genuineness of the transaction. In case of CIT vs. Diamond Products Ltd. (2009) the Hon'ble Delhi High Court held that the AO is not permitted to examine the source of source, once the assessee has established that the creditor is genuine and creditor's identity and genuineness has been established. Therefore, considering the facts and circumstances of the case it is seen that The AO has made addition on the basis of presumptions. Even when the remand report was called from the AO, he did not make any enquiry from Sh. Akash Taneja or from IIHFL, who gave housing loan to Sh. Akash Taneja. The onus had been duly discharged by the appellant and the AO did not bring any material on record to disprove the credit entry in the account of the appellant. The additions made of Rs 1,38,00,000/- and of Rs.5,94,000/-, are, therefore, deleted. 8. From the perusal of the above discussion and findings, it is apparent on record that Ld. AO had accepted the fact that cash deposits were more than the cash withdrawals. Ld. AO accepted only cash withdrawals by ATM but disbelieve cash withdrawals by cheque while making addition of Rs.18,45,000/- which was illegal. 8.1 Pawan Taneja and assessee had operating joint account. Ld. AO accepted only cash withdrawals by ATM and regarding other cash withdrawals he wanted confirmation from the bank assessee and her husband had operated joint bank Printed from counselvise.com 9 ITA No.946/Del/2020 ACIT vs. Vibha Taneja account. The cash deposits were more than the cash withdrawals so the addition of Rs.11,12,500/- was rightly deleted. 8.2 Regarding addition of Rs.1,43,94,000/- on account of unexplained cash credit deposits made in the account of Sh. Akash Taneja. Ld. AO noticed that there was a deposits of Rs.1,38,00,000/- in the account of assessee. The deposit was explained as being out of loan of Rs.1,75,00,000/- by her son Sh. Akash Taneja. As per AO there was also entry of Rs.5,94,000/- received from Sh. Akash Taneja. Ld. AO that evidence of loan had made the addition. Assessee had explained loan of Rs.1,38,000/- taken from Sh. Akash Taneja who had taken loan from M/s IIFL as Home Loan. 8.3 In view of above material facts in absence of any evidence to the contrary, the grounds of appeal of Revenue being devoid of merits are untenable. 9. In the result, the appeal filed by the Revenue is dismissed. Order is pronounced in the Open Court 20.02.2026. Sd/- Sd/- -/- (RENU JAUHRI) (VIMAL KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 20.02.2026 *PK, Sr. Ps* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI Printed from counselvise.com "