DARIUS SAM MOTASHAW (THROUGH LEGAL REPRESENTATIVE JEHAN MOTASHAW),MUMBAI V. ASST. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 4(11), MUMBAI

ITA 2966/MUM/2025

AI Insights

The case involves an appeal by Darius Sam Motashaw against an order by the National Faceless Appeal Centre, Delhi, which confirmed an addition of Rs. 2,85,600 as unexplained cash credits under section 68 of the Income Tax Act for the assessment year 2011-12. The amount was received through a banking channel from his broker, M/s. Sykes and Ray Equities. The assessee argued that the amount was part of regular transactions with the broker, which included substantial payments made through banking channels. The revenue authorities upheld the addition, claiming the assessee failed to prove the source of the amount. The Tribunal, however, found that the AO did not adequately verify the authenticity of the documents provided by the assessee and failed to investigate further by not summoning the broker.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 714549 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2011-2012
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRAVIN SALUNKHE
• Assessee Lawyers: RASHMIKANT MODI; KETKI RAJESHIRKE
• Keywords: Unexplained cash credit
• Section: 68

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH MUMBAI BEFORE HON’BLE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER ITA No. 2966/Mum/2025 (Assessment Year: 2011-12) Darius Sam Motashaw (Through legal representative Jehan Motashaw) 10A, Jiwan 11LD Ruparel Marg, Malabar Hill, Mumbai Vs. ACIT, CC – 4(1) Kautilya Bhavan, C41-43, G Block BKC, Badra East, Mumbai. PAN/GIR No. AASPM9391A (Applicant) (Respondent) Assessee by Shri Rashmikant Modi & Ms. Ketki Rajeshirke Revenue by Shri Pravin Salunkhe, Sr.DR Date of Hearing 26.06.2025 Date of Pronouncement 04.08.2025 आदेश / ORDER PER SANDEEP GOSAIN, JM: The present appeal has been filed by the assessee challenging the impugned order dt. 27.02.2025 passed u/s 250 of the Income Tax Act, 1961 (‘the Act’), by the National Faceless Appeal Centre, Delhi (NFAC) for the assessment year 2011-12. 2. The only ground raised by the assessee is ground No. 1 which relates to challenging the order of Ld. CIT(A) in Printed from counselvise.com 2 ITA No. 2966/Mum/2025 Darius Sam Motashan., Mumbai confirming of Rs. 2,85,600/- as unexplained cash credits u/s 68 of the Act mad by A.O. 3. In this regard Ld. AR submitted that the said amount was received by assessee through banking channel from broker of the assessee i.e M/s. Sykes and Ray Equities on 24.11.2010. It was submitted that the assessee had been regularly dealing with the broker and had been making payments for investments and had also made payments of Rs. 21,27,595/- through banking channel through the broker. However the revenue authorities have wrongly added the said amount u/s 68 of the Act. 4. On the contrary, Ld. DR relied upon the orders passed by the revenue authorities and submitted that assessee could not prove the sources of the said amount therefore addition was rightly made and upheld. 5. I have heard the counsels of both the parties, perused the material placed on record and also the orders passed by the revenue authorities. Printed from counselvise.com 3 ITA No. 2966/Mum/2025 Darius Sam Motashan., Mumbai 6. After having gone through the facts of the present case, I noticed that undisputedly the said amount of Rs. 2,85,600/- was received by assessee from its broker through cheque and in this regard the assessee had already placed on record bank statement and the ledger of the broker. However the said documents were negated by the revenue authorities only on the ground that the same are not signed or authenticated. It is strange to note that AO had not carried out any exercise or verification in respect of the documents submitted by the assessee. In my view AO is not only an adjudicator but he is also an investigator, therefore it was all the more duty of the AO to issue summons / notices to the broker in order to ascertain the said documents or he could have dig deeper which was expected from him being the investigator but by not doing so, AO was not entitled to make additions only on this ground alone. 7. Even it would not be out of place to mention that the assessee had transferred Rs. 21,27,595/- to the broker and the said amount has not been disputed. 8. Therefore in such a circumstances when once assessee had already discharged its onus therefore no addition Printed from counselvise.com 4 ITA No. 2966/Mum/2025 Darius Sam Motashan., Mumbai could have been made u/s 68 of the Act of the said amount of Rs. 2,85,600/-, which the assessee had received from its broker through cheque. Therefore, I direct the AO to delete the said addition as the same is without any foundation or basis. Thus this ground raised by the assessee stands allowed. 9. The assessee has not pressed any other ground raised in the grounds of appeal, therefore the appeal filed by the assessee is partly allowed. Order pronounced in the open court on 04.08.2025. Sd/- (SANDEEP GOSAIN) JUDICIAL MEMBER Mumbai, Dated 04/08/2025 KRK, Sr. PS आदेश की \bितिलिप अ\u000eेिषत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. \u000eथ / The Respondent. 3. संबंिधत आयकर आयु\u0019 / The CIT(A) 4. आयकर आयु\u0019(अपील) / Concerned CIT 5. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, मु\u0003बई / DR, ITAT, Mumbai 6. गाड फाईल / Guard file. आदेशानुसार/ BY ORDER, स\u000eािपत ित //True Copy// 1. उप/सहायक पंजीकार ( Asst. Registrar) आयकर अपीलीय अिधकरण, मु\u0003बई मु\u0003बई मु\u0003बई मु\u0003बई / ITAT, Mumbai Printed from counselvise.com "