DCIT CENTRAL CIRCLE, JAMSHEDPUR V. MAHENDRA GOPE, JAMSHEDPUR

ITA 94/RAN/2023

AI Insights

The case involves appeals by the revenue against the orders of the CIT(A) for the assessment years 2016-17 and 2018-19. The primary contention was regarding the disallowance of certain expenses deemed non-verifiable during a survey conducted on the assessee's premises. The CIT(A) had estimated a disallowance at 10% of these expenses, which the revenue challenged, arguing that any non-verifiable expense should be entirely disallowed. In the second appeal for the assessment year 2018-19, the revenue contested the deletion of disallowances related to sundry creditors and unsecured loans, arguing that the assessee had not cooperated in the assessment proceedings. The tribunal decided to restore both issues to the AO for a fresh examination.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 633637 (ITAT-RANCHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2025
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2018-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KHUBCHAND PANDYA
• Assessee Lawyers: SHRIV.JALAN

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, BEFORE AND RATNESH NANDAN SAHAY, ACCOUNTANT MEMBER Dy.CIT, Central Circle, Jamshedpur PAN/GIR No.ACVPG 4361 K (Appellant Per Bench These are appeals filed by the revenue against the orders of ld CIT(A) Patna-3 dated 26.12.2022 the assessment year 16 IN THE INCOME TAX APPELLATE TRIBUNAL, RANCHI BENCH, RANCHI BEFORE S/SHRI GEORGE MATHAN, JUDICIAL MEMBER AND RATNESH NANDAN SAHAY, ACCOUNTANT MEMBER ITA No.21/RAN/2023 Assessment Year: 2016-17 ITA No.94/Ran/2023 ASSESSMENT YEAR: 2018-19 Central Circle, Vs. Mahendra Gope, C Block, Qtr No.204, Madhusudan Complex, Mango, Jamshedpur ACVPG 4361 K (Appellant) .. ( Respondent Assessee by : ShriV.Jalan, AR Revenue by :Shri Khub Chand Pandya Date of Hearing : 10/06/202 Date of Pronouncement :10/06/202 O R D E R These are appeals filed by the revenue against the orders of ld CIT(A) 3 dated 26.12.2022 in Appeal No. CIT(A), Jamsedpur/10210/2018 the assessment year 16-17and order of ld CIT(A),Patna P a g e 1 | 4 IN THE INCOME TAX APPELLATE TRIBUNAL, SHRI GEORGE MATHAN, JUDICIAL MEMBER AND RATNESH NANDAN SAHAY, ACCOUNTANT MEMBER Mahendra Gope, C Block, Qtr No.204, Madhusudan Complex, Mango, Jamshedpur Respondent) Shri Khub Chand Pandya, Sr DR /2025 /2025 These are appeals filed by the revenue against the orders of ld CIT(A), CIT(A), Jamsedpur/10210/2018-19 for and order of ld CIT(A),Patna-3 in Appeal ITA No.21/Ran/2023 ITA No.94/Ran/23 Assessment Year:16-17 & 18-19 P a g e 2 | 4 Nio.CIT(A),Patna-3/103423/2017-18 dated 26.2.2023 for assessment year 2018- 19. 2. Shri Khub Chand Pandya, ld Sr DR appeared for the revenue and Shri V.Jalan, ld AR appeared for the assessee. 3. In regard to ITA No.21/Ran/23 for the assessment year 2016-17, it was submitted by ld Sr DR that there was a survey on the premises of the assessee on 5,10,2019. In the course of survey, the assessee had admitted the undisclosed income of Rs.1,88,12,008/- on account of discrepancy in the bills and vouchers most-specifically non-verifiable expenses. It was the submission that on appeal, ld CIT(A) estimated the disallowance at 10% of said unverifiable expenses. It was the submission that when Rs.1.88 crores itself was non- verifiable, the disallowance of 10% was not permissible. 4. Ld AR submitted that no portion of the expenses are unverifiable and all the expenses can specifically be proved. 5. We have considered the rival submissions. As it is noticed from the assessment order that in the course of survey, the assessee has specifically stated that he has Rs.1.88 croes on account of non-verifiable expenses and now ld AR submits that he is in a position to prove the expenses, in the interest of justice, the issues in this appealis restored to the file of the AO for readjudication after granting adequate opportunity of hearing. The assessee shall provide the ITA No.21/Ran/2023 ITA No.94/Ran/23 Assessment Year:16-17 & 18-19 P a g e 3 | 4 bills and vouchers of all expenses in respect of the expenses incurred in the impugned assessment year before the AO. 6. In the result, appeal in ITA No.21/Ran/23 stands partly allowed for statistical purposes. 7. In regard to ITA No.94/Ran/23 relevant to assessment year 2018-19, it was submitted by ld Sr DR that the Assessing Officer had made disallowance of the sundry creditors and the unsecured loans. The assessee had not cooperated in the assessment proceedings even though multiple opportunities were given. It was the submission that the ld CIT(A) without considering the non-cooperation of the assessee on presumption basis has deleted the disallowance. 8. Ld AR submitted that the assessee has cooperated in the assessment proceedings and the AO has not asked for any of the details. It was the submission that the ld CIT(A) after appreciating the fact that the AO had not called for details deleted the addition. 9. We have considered the rival submissions. A perusal of the assessment order clearly shows that the AO has categorically admitted that a show cause notice has been issued to the assessee and even that remains un-responded. A perusal of the order of ld CIT(A) shows that the ld CIT(A) has considered the evidences which were not before the AO. This being so, in the interest of justice, the issues in this appeal are restored to the file of the AO for re-adjudication after granting adequate opportunity of hearing to the assessee. ITA No.21/Ran/2023 ITA No.94/Ran/23 Assessment Year:16-17 & 18-19 P a g e 4 | 4 10. In the result, appeal of the revenue in ITA No.94/Ran/23 stands partly allowed for statistical purposes. Order dictated and pronounced in the open court on 10/06/2025. Sd/- Sd/- (RATNESH NANDAN SAHAY) (GEORGE MATHAN) ACCOUNTANT MEMBER JUDICIAL MEMBER Ranchi; Dated 10/06/2025 B.K.Parida, SPS (OS) Copy of the Order forwarded to : By order Sr.Pvt.secretary ITAT, Ranchi 1. The Appellant :Dy.CIT, Central Circle, Jamshedpur 2. The respondent: Mahendra Gope, C Block, Qtr No.204, Madhusudan Complex, Mango, Jamshedpur 3. The CIT(A)Patna-3 4. Pr.CIT, 5. DR, ITAT, 6. Guard file. //True Copy// "