AMOL GAJANAN DHARME,THANE V. ITO WARD 1(4), THANE

ITA 6380/MUM/2025

AI Insights

The case involves Amol Gajanan Dharme, a sole proprietor engaged in print media and television channels, who appealed against the order of the CIT(A) which upheld the addition of Rs.81,00,000 to his income as unexplained investment under section 69 of the Income Tax Act. The addition stemmed from the sale of a residential property for Rs.81,00,000, which was credited to the assessee's bank account. The assessee claimed exemption under section 54 by reinvesting the proceeds in another property. The Income Tax Officer (ITO) initially added the amount as unexplained due to insufficient documentation, a decision later upheld by the CIT(A). However, the Tribunal found that the assessee had provided sufficient evidence during the appellate proceedings, including sale agreements and bank statements, which were not adequately considered by the CIT(A).

• Duration Of Justice: 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Mumbai
• Assessment Year: 2014-2015
• Appeal Filed On: 08-10-2025
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SURENDRA MOHAN
• Assessee Lawyers: SANJIV BRAHME
• Keywords: Set aside; Additional evidence; Corroborative evidences; Unexplained investment; Capital Gains; TDS
• Section: 143(3); 142(1); 54; 69

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “A”, MUMBAI BEFORE SHRI ANIKESH BANERJEE, JUDICIAL MEMBER AND SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER ITA No.6380/Mum/2025 (Assessment year: 2015-16) Amol Gajanan Dharme A-20, Amargian Industrial Opp. S.T. Workshop, Khopat Thane-400601 PAN:ADDPD5229Q vs ITO Ward 1(4), Mumbai Ashar IT Park, Neheru Nagar, Wagle Industrial Estate, Thane West, Thane-400604 APPELLANT RESPONDENT Assessee by : Shri Sanjiv Brahme Respondent by : Shri Surendra Mohan (Sr. DR) Date of hearing : 24/03/2026 Date of pronouncement : 27/03/2026 O R D E R Per: Anikesh Banerjee (JM): The instant appeal of the assessee filed against the order of the NFAC, Delhi [for brevity the “Ld. CIT(A)”], order passed under section 250 of the Income Tax Act 1961 (for brevity ‘the Act’) for Assessment Year 2014-15, date of order 20.08.2025. The impugned order emanated from the order of the Ld. Income Tax Officer Ward-1(4), Thane (for brevity the ‘Ld. AO’) order passed under section 143(3) of the Act date of order 15.12.2016. Printed from counselvise.com 2 ITA No.6380/Mum/2025 Amol Gajanan Dharme 2. The brief facts of the case are that the assessee is carrying on business as a sole proprietor under the name “Sarathi Enterprise”, primarily engaged in activities relating to print media and television channels. The assessee filed the return of income declaring a total income of Rs.30,22,130/-, comprising income from business as well as capital gains. During the year under consideration, the assessee sold a residential property, being “Flat No. 402 in Sukhakarta CHS Ltd.”, for a consideration of Rs.81,00,000/- on 30.12.2013. The said property had originally been acquired on 05.06.2002 for a consideration of Rs.1,83,000/-. In order to claim exemption from capital gains tax, the assessee invested a sum of Rs.1,70,21,360/- in the purchase of another residential property and accordingly claimed exemption under section 54 of the Act. During the course of assessment proceedings, the Ld. AO observed that an amount of Rs.81,00,000/- was credited to the assessee’s bank account. In the absence of adequate supporting evidence and sale documentation, the Ld. AO treated the said amount as unexplained investment under section 69 of the Act and added the same to the total income. Aggrieved, the assessee preferred an appeal before the Ld. CIT(A) and furnished additional evidence under Rule 46A of the Income-tax Rules, 1962 (Rules). The Ld. CIT(A) called for a remand report from the Ld. AO. During the remand proceedings, the assessee submitted the requisite documents; however, the Ld. AO rejected the submissions and reiterated the addition. Consequently, the Ld. CIT(A) upheld the addition of Rs.81,00,000/- and dismissed the appeal of the assessee. Being further aggrieved, the assessee has preferred the present appeal before us. Printed from counselvise.com 3 ITA No.6380/Mum/2025 Amol Gajanan Dharme 3. The Ld. AR submitted that a paper book comprising pages 1 to 100 has been placed on record. It was contended that the assessee had sold two properties, namely a flat at “Sukhakarta” and another at “Haware City”, and had reinvested the sale proceeds in the purchase of two residential flats aggregating to Rs.1,70,21,360/-. In support of the claim, the Ld. AR placed reliance on the following documents filed before the Bench: as under— 1. Income tax computation, APB page 6 to 7 2. Bank statement related to flat no.402, APB pages 8 to 10 3. Purchase agreement of Sukhakarta flat no.402, APB page 11 to 59 4. Sale agreement of Sukhakarta Flat No.402, APB page 60 to 100. 4. the Ld. AR contended that related to the sale of property the purchaser deduced the TDS at the rate of 1% which comes to Rs.81,000/- which is reflected in the Form No.26AS. The Ld. AR further argued that during the remand proceeding the assessee has submitted all the relevant documents by a letter dated 12.08.2024, filed before the Ld. AO on 12.08.2024. The said compliance letter is reproduced as below: Printed from counselvise.com 4 ITA No.6380/Mum/2025 Amol Gajanan Dharme 5. The Ld. DR contended that the assessee had failed to produce the basic documents before the Ld. AO. It was submitted that the observations of the Ld. Printed from counselvise.com 5 ITA No.6380/Mum/2025 Amol Gajanan Dharme AO in the remand report have been duly considered by the Ld. CIT(A) and are also reproduced in the impugned appellate order. The Ld. DR drew our attention to the relevant portions of the impugned appellate order, which are reproduced as under: “Ld. AO’s comments on submission made by the assessee with CIT(A) during appellate proceedings: On perusal of ITR filed by the assessee for the AY 2014-15 it is seen that the assessee has claimed exemption u/s 84 to the tune of Rs. 93,86,057/-, The assessee during the year under consideration, sold two immovable properties i.e. flat at Sukhakarta building and Haware City. The assessee invested the proceeds received from the sale of the properties in two adjoining residential houses i.e. flat No. 101 & 102 at Sukhakarta building and claimed exemption uls 54 of the IT Act. The AO during assessment proceedings vide notice u/s 142(1) of the IT Act dated 27.04.2016 & 29.06.2016 requested to produce documentary evidences in support of exemption claimed u/s 54 of the IT Act. On perusal of the submission of the assessee it seen that the assessee has falled to submit copy of purchase agreement in respect of flat sold at Haware City. Further the assessee also also failed to submit bank statement with regards to amount received/paid against sale or purchase of property. Despite several request has been made the assessee did not produce the required documents during assessment proceedings. During appellate proceedings the assessee filed its arguments along with assessment order, Form No. 35, grounds of appeal, statement of facts, copy of purchase agreement of Flat at SukhakartaBuiding, copy of sale agreement of flat at Sukhararta building and Haware city, y copy of of 26AS. However, the additional evidences submitted by the assessee during appellate proceedings does not substantiate assessee's claim. On perusal of the documents submitted by the assessee it is seen that the assessee has once again submitted the same documents which were already filed by him during assessment proceedings. On further verification it is seen that the assessee has again failed to submit copy of purchase agreement in respect to flat sold at Haware City (flat No. 2002, 20th Floor, Haware City, Phase-II, Building No. 16, Vill - Wadavali, Thane) and bank statement in respect of amount received/paid against sale or purchase of property. During remand report proceedings this office had issued letter dated 25.07.2024 (DIN No. ITBA/COM/F/2024-25/1067004896(1)) to the assessee, requesting to submit all relevant documents/evidences to enable this office submit the remand report proceedings. However, no response has been filed by the assessee to substantiate his claim. Printed from counselvise.com 6 ITA No.6380/Mum/2025 Amol Gajanan Dharme 1. From the above, it can be seen that there were no cogent evidences submitted by the assessee to prove the genuineness of assessee's claim. The assessee during appellate proceedings had taken a stand that the AO did not consider theevidences submitted during assessment proceedings which resulted into disallowance of claim. But the assessee failed to highlight the fact that he has miserably failed to submit basic documents like copy of purchase agreement of the property sold to ascertain actual value of capital gain and copy of bank statement to examine the transactions were entered through banking channels only. Before passing the assessment order the assessee was given various opportunities to file relevant documents/evidences in support of his claim of exemption u/s 54 of the IT Act. The assessee filed incomplete details during assessment proceedings and also during appellate proceedings as well. Thus, the additional evidences submitted by the assessee have no evidential value in terms of explanation/proof for the additions made in the assessment order, as no additional evidences/details are submitted by the assessee. 2. Therefore, in my opinion, the addition made of Rs. 81,00,000/- u/s 69 of the IT Act appears to be correct and needs to be confirmed.\" 6. We have heard the rival submissions and perused the material available on record. It is an undisputed fact that the assessee had filed the return of income under section 139(1) of the Act declaring income from business as well as capital gains. During the year under consideration, the assessee sold immovable properties and claimed exemption under section 54 of the Act upon reinvestment in residential properties. We note that during the assessment proceedings, the assessee could not furnish complete documentary evidence to substantiate the claim, which led the Ld. AO to treat the amount of Rs.81,00,000/- as unexplained investment under section 69 of the Act. However, during the appellate proceedings, the assessee placed on record additional evidence, including the sale agreement, bank statements, and other supporting documents. The Ld. CIT(A) called for a remand report, and the assessee duly furnished the relevant documents before the Ld. AO. On careful consideration, we find that the sale consideration of Rs.81,00,000/- is duly reflected in the bank account of the Printed from counselvise.com 7 ITA No.6380/Mum/2025 Amol Gajanan Dharme assessee, and the deduction of TDS at the rate of 1% is also evidenced in Form No. 26AS. These documents substantiate the genuineness of the transaction. The addition made by the Ld. AO was primarily on account of non-furnishing of documents during the assessment stage; however, the same stood explained during the appellate proceedings. We further observe that the Ld. CIT(A), despite having called for a remand report, has not properly appreciated the evidences placed on record and has upheld the addition without granting adequate weight to the material furnished by the assessee. In our considered view, once the assessee has substantiated the source of the credit with cogent documentary evidence, the provisions of section 69 cannot be invoked. Accordingly, we set aside the impugned appellate order and direct the deletion of the addition of Rs.81,00,000/- made under section 69 of the Act. The appeal of the assessee is allowed. 7. In the result, the appeal of the assessee bearing ITA No.6380/Mum/2025 is allowed. Order pronounced in the open court on 27th day of March 2026. Sd/- Sd/- (GIRISH AGRAWAL) (ANIKESH BANERJEE) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai,िदनांक/Dated: 27/03/2026 SAUMYASr.PS Copy of the Order forwarded to: 1. अपीलाथŎ/The Appellant , 2. Ůितवादी/ The Respondent. 3. आयकरआयुƅ CIT 4. िवभागीयŮितिनिध, आय.अपी.अिध., मुंबई/DR, ITAT, Mumbai Printed from counselvise.com 8 ITA No.6380/Mum/2025 Amol Gajanan Dharme 5. गाडŊफाइल/Guard file. BY ORDER, //True Copy// (Asstt. Registrar), ITAT, MUMBAI Printed from counselvise.com "