BALWINDER KAUR,FATEHABAD, HARYANA V. ITO, WARD-1, FATEHABAD, FATEHABAD, HARYANA

ITA 446/CHANDI/2025

AI Insights

The case involves Balwinder Kaur, who appealed against the order of the CIT(A), National Faceless Appeal Centre, which upheld the addition of Rs. 8,95,499 to her income as unexplained investment in agricultural land. The Assessing Officer had initially made this addition after the assessee failed to satisfactorily explain the source of her investment in land. The Tribunal found that the assessee had provided a reasonable explanation for the source of funds, which was from her husband's cash business of selling milk. The Tribunal noted that it is a common practice for milk to be sold in cash, and thus, the cash flow statement provided by the assessee should have been accepted.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 779432 (ITAT-CHANDIGARH)
• Duration Of Justice: 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2017-2018
• Appeal Filed On: 25-03-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIVEK VARDHAN
• Assessee Lawyers: PARIKSHIT AGGARWAL
• Keywords: Opportunity of being heard; Unexplained investment
• Section: 147; 148; 142(1)

Judgement Text

"आयकर अपीलȣय अͬधकरण, चÖडीगढ़ Ûयायपीठ, चÖडीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH, ‘A’, CHANDIGARH BEFORE SHRI RAJPAL YADAV, VICE PRESIDENT & SHRI KRINWANT SAHAY, ACCOUNTANT MEMBER आयकर अपील सं./ ITA No. 446/CHD/2025 Ǔनधा[रण वष[ / Assessment Year : 2017-18 Balwinder Kaur, W/o Sh. Sukhwant Singh Village Aherwan, P.O. Aherwan Ratia, Fatehabad, Haryana 125051 बनाम Vs. The ITO, Ward 1, Fatehabad èथायी लेखा सं./PAN NO. GYZPK9424B अपीलाथȸ/Appellant Ĥ×यथȸ/Respondent ( Hybrid Mode ) Ǔनधा[ǐरती कȧ ओर से/Assessee by : Sh. Parikshit Aggarwal, C.A. राजèव कȧ ओर से/ Revenue by : Shri Vivek Vardhan, Addl. CIT, Sr. DR सुनवाई कȧ तारȣख/Date of Hearing : 31-07-2025 उदघोषणा कȧ तारȣख/Date of Pronouncement : 14-10-2025 आदेश/Order Per Krinwant Sahay, AM: Appeal in this case has been filed by the assessee against the order dated 07.02.2025 of Ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi. Printed from counselvise.com 2 446-Chd-2025- Balwinder Kaur, Fatehabad 2. Grounds of appeal are as under: 1. That on the facts, circumstances and legal position of the case, the Worthy CIT(A), NFAC in Appeal No. NFAC/2016- 17/10239413 has erred in passing order dtd. 07.02.2025 in contravention of provisions of 3. 250 of the Income Tax Act, 1961 (hereinafter referred to as \"Act\"). 2. That on facts, circumstances and legal position of the case, Worthy CIT(A) has erred in upholding the action of Ld. AO of initiating, continuing and then concluding the impugned assessment u/s 148 r.w.s. 147 and hence the impugned assessment order deserves to be quashed. 3. That on facts, circumstances and legal position of the case, notice issued by the Ld. AO u/s 148 dtd. 28.07.2022 is bad in law deserving to be quashed since the same was without any valid DIN. 4. That on facts, circumstances and legal position of the case, the notice issued u/s 148 dtd. 30.06.2021 is bad in law deserving to be quashed since the same was issued physically and not digitally. 5. That on facts, circumstances and legal position of the case, Worthy CIT(A) has Printed from counselvise.com 3 erred in confirming the addition made by the Ld. AO of Rs. 8,95,499/-u/s 69 on account of unexplained investment in acquisition of immovable asset even when the same was explained. 6. That on facts, circumstances and legal position of the case, Worthy CIT(A) has erred in confirming the action of Ld. AO in imposing tax rate of 60% u/s 115BBE plus surcharge thereon on above addition made u/s 69A in Ground No. 4, even when if the said addition is accepted academically, the same could only have been taxed at normal rates. 7. That on facts, circumstances and legal position of the case, the order passed by Ld. AO and then by Worthy CIT(A) u/s 250 deserves to be quashed since the same has been passed without affording reasonable opportunity of being heard to the appellant. 8. That the appellant craves leave for any addition, deletion or amendment in the grounds of appeal on or before the disposal of the same. 3. Brief facts of the case, as per the order of the Ld. CIT(A), are as under:- The brief facts of the case are that the assessee had filed the return of income for the Printed from counselvise.com 4 said assessment year. Subsequently, it is reported that the assessee made an investment of Rs. 20,66,910/-in purchase of agricultural land. Therefore, a notice u/s 148 was issued to the assessee on 28.07.2022, requiring the assessee to file the return of income but no compliance was received from the assessee. Further, notice u/s 142(1) was issued to the assessee and for the assessee has submitted a written submission and furnished the details of source of investment. After considering the submission, Assessing Officer has made an addition of Rs. 8,95,499/- as source of this investment could not be not explained by the appellant. 4. During proceedings before us, the ld. Counsel for the Assessee submitted that the Assessee made an investment of Rs. 20,66,910/- in purchase of agricultural land. During assessment proceedings, the Assessee was asked to explain the source of investment. The Assessee filed a detailed reply and on the basis of reply filed by the Assessee, the Assessing Officer accepted the amount of Rs. 11,71,411/- Printed from counselvise.com 5 as explained and rest of the amount of Rs. 8,95,499/- was added in the hands of the Assessee. In fact, during proceedings before the Assessing Officer, the Assessee by filing a Cash Flow statement claimed that this amount was taken by the Assessee from her husband who had a business of selling milk but the Assessing Officer did not accept that the entire sale of milk was in cash and, therefore, he made this addition in the hands of the Assessee. The Ld. CIT(A) confirmed the addition made by the Assessing Officer. 5. The Ld. Counsel of the Assessee during the proceedings before us submitted before the Bench that in normal practice, milk is always sold in cash because an individual buyer of milk normally does not pay by cheque, therefore, , the submissions of the Assessee should have been accepted by the authorities below. 6. Per contra, ld. DR relied on the order of the authorities below. 7. We have considered the findings given by the Assessing Officer in the assessment order and the CIT(A) in the Printed from counselvise.com 6 appellate order. We are of this considered view that as a normal practice prevailing in our society, milk is normally sold in cash only, as such, to expect the milkman to take cheque from the buyer of the milk is not practical in the society. Therefore, if the cash flow statement filed by the Assessee before the Assessing Officer showed that a cash was received by the sale of milk, then that should have bene considered positively by the authorities below. Accordingly, after going through he documents filed by the ld. AR of the Assessee and after listening and considering his argument on this issue, we are inclined to accept this proposition. Thus, Assessee’s appeal on this issue is allowed. 8. The Assessee has filed this appeal challenging the impugned assessment u/s 148 read with section 147 of the I.T. Act but since we have already allowed the appeal of the Assessee on merit, therefore, this legal / technical issue just remains academic in nature. Accordingly, we are not inclined to decide it. Printed from counselvise.com 7 9. In the result, the appeal of the Assessee stands allowed. Order pronounced on 14.10.2025 Sd/- Sd/- ( RAJPAL YADAV ) (KRINWANT SAHAY) Vice President Accountant Member “आर.क े.” आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of the order forwarded to : 1. अपीलाथȸ/ The Appellant 2. Ĥ×यथȸ/ The Respondent 3. आयकर आयुÈत/ CIT 4. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय आͬधकरण, चÖडीगढ़/ DR, ITAT, CHANDIGARH 5. गाड[ फाईल/ Guard File आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar Printed from counselvise.com "