ARJUN SINGH,PALWAL V. INCOME TAX OFFICER WARD 1(1), FARIDABAD

ITA 5095/DEL/2025

AI Insights

The case revolves around an appeal by Arjun Singh against the order of the National Faceless Appeal Centre (NFAC), which upheld the addition of 1,50,000 to the assessee's income as undisclosed income for the Assessment Year 2013-14. The primary contention was whether the cash received from the sale of ancestral agricultural land, which was subsequently deposited in the assessee's bank account, constituted undisclosed income. The Tribunal examined the documentation and the statements made by the assessee during the assessment proceedings, which confirmed the legitimacy of the cash transactions. The Tribunal's decision was based on the thorough examination of the sale deed and the bank transactions, leading to the conclusion that the cash receipts were not undisclosed and thus should not attract additional tax.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 842127 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: misc
• Appeal Filed On: 22-08-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANKUSH KALRA
• Assessee Lawyers: CHARITRA GUPTA
• Keywords: Income from undisclosed sources
• Section: 143(3)

Judgement Text

"INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “E”: NEW DELHI BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENT AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER ITA No. 5095/Del/2025 (Assessment Year: 2013-14) Arjun Singh, H. No. 1014, Prithla, Palwarl, Haryana Vs. Income Tax Officer, Ward-1(1), Faridabad (Appellant) (Respondent) PAN: EICPS8476L Assessee by : Shri Charitra Gupta, CA Shri Deepak Garg, CA Revenue by: Ms. Ankush Kalra, Sr. DR Date of Hearing 17/02/2026 Date of pronouncement 17/02/2026 O R D E R PER M. BALAGANESH, AM 1. The appeal in ITA No.5095/Del/2025 for AY 2013-14, arises out of the order of the ld National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘ld. CIT(A)’, in short] dated 27.01.2025 against the order of assessment passed u/s 143(3) r.w.s. 147 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 28.12.2018 by the Assessing Officer, ITO, Ward-1(1), Faridabad (hereinafter referred to as ‘ld. AO’). 2. The only issue to be decided in this appeal is as to whether the ld CIT(A) was justified in confirming the addition made by the ld AO in the sum of Printed from counselvise.com ITA No. 5095/Del/2025 Arjun Singh Page | 2 ₹61,50,000/- as income from undisclosed sources in the facts and circumstances of the instant case. 3. We have heard the rival submissions and perused the materials available on record. The assessee is a farmer in a village in Haryana and derived income only from agricultural activities and hence not liable to file any income tax return. The assessee during the year under consideration had sold a part of ancestral agricultural land to one Shri Ram Niwas, S/o Shri Tej Ram who later got it registered in the name of his grandfather Shri Deep Chand. The assessee received advance in cash of ₹1.18 crores against the proposed sale of part of ancestral agricultural land. The sale deed was finally registered on 11.03.2013 for ₹1.18 crores. The copy of the sale deed together with the complete revenue records are enclosed in pages 21 to 39 of the paper book filed before us. It is pertinent to note that the registered sale deed duly captures the payment of advance of ₹1.18 crores paid in cash by the buyer to the assessee. Further, during the course of assessment proceedings, the ld AO recorded a statement of the assessee u/s 131(1) of the Act on oath on 14.12.2018, where the assessee had duly confirmed the aforesaid transactions and also stated that the cash receipts by the assessee had been deposited in the bank account of the assessee, apart from receipt of cheque of ₹4.66 Crores on sale of ancestral agricultural land, even though registry was done only for ₹1.18 crores. It is pertinent to note that the ld AO had not whispered about the receipt of amounts of cheque amounting to ₹4.66 Crores on sale of agricultural land in his assessment order and had not even sought to tax the same in the assessment. Since, this is not the subject matter of adjudication, we are not going into the said aspect. The statement on oath taken from the assessee clearly shows both cheque receipts as well as cash receipts on sale of ancestral agricultural land. Printed from counselvise.com ITA No. 5095/Del/2025 Arjun Singh Page | 3 The assessee had deposited ₹1,22,50,000/- in his bank account till 12.03.2013 in his bank account. The assessee has withdrawn cash from till 12.03.2013 in the sum of ₹61,50,000/-, which was accepted by the AO as available cash source. Further for the remaining sum of ₹61 lakh, the assessee had sufficient cash balance in the form of advance received on sale of ancestral agricultural land in the sum of ₹1.18 crores. This fact is proved beyond reasonable doubt since the registration of sale deed contained the receipt of cash of ₹1.18 crores by the assessee. Hence, the explanation offered by the assessee that ₹1.18 crores was received in cash on sale of ancestral agricultural land deserves to be accepted and consequentially the same is available as a cash source to explain the cash deposit made in the bank account. Hence, there cannot be any addition that could be made in the hands of the assessee on account of cash deposit. Accordingly, grounds raised by the assessee on merits are allowed. Since, the relief is granted to the assessee on merits, the other legal grounds raised by the assessee need not be gone into and they are left open. 4. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 17/02/2026. -Sd/- -Sd/- (MAHAVIR SINGH) (M. BALAGANESH) VICE PRESIDENT ACCOUNTANT MEMBER Dated: 24/02/2026 A K Keot Copy forwarded to 1. Applicant Printed from counselvise.com ITA No. 5095/Del/2025 Arjun Singh Page | 4 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi Printed from counselvise.com "