DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 3(1), KOLKATA V. CHIRAG JEWELLERS, KOLKATA

MA 79/KOL/2025

AI Insights

The case involves the Deputy Commissioner of Income Tax, Central Circle 3(1), Kolkata, as the appellant, and Chirag Jewellers as the respondent. The Revenue filed Miscellaneous Applications seeking rectification of the Tribunal's earlier orders which had dismissed their appeals concerning additions made under section 68 of the Income Tax Act for the Assessment Years 2015-16 and 2016-17. The Revenue argued that the Tribunal erred in dismissing the appeals solely on monetary grounds without considering the substantial additions made by the Assessing Officer (AO) regarding unexplained transactions and credits. The Tribunal, however, found that the Revenue did not meet the criteria for exceptions under the CBDT Circular, which pertains to cases involving money laundering, and thus upheld the dismissal of the appeals.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 787994 (ITAT-KOLKATA)
• Duration Of Justice: 8 month(s) 6 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 25-11-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: misc
• Appeal Filed On: 19-03-2025
• Other Referred Cases: CIT vs Durga Prasad More (1971 82 ITR 540 (SC)), Sumati Dayal vs CIT (1995 214 ITR 801: 80 Taxman 89 (SC))
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect; Rectification of order
• Section: 68

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, KOLKATA SHRI GEORGE MATHAN, JUDICIAL MEMBER SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER MA No. 78/KOL/2025 (Arising out of IT(SS)A 92/Kol/2024) Assessment Year: 2015-16 & MA No. 79/KOL/2025 (Arising out of ITA No. 1636/Kol/2024) Assessment Year: 2016-17 Deputy Commissioner of Income Tax, Central Circle 3(1), Kolkata, 110, Shantipally, Kolkata - 700107 .....................…...……………....Appellant vs. Chirag Jewellers, Office No. 2A, 2nd Floor, Aspirations Vintage, 12, Pretoria Street, Kolkata - 700001 ........................................ Respondent [PAN: AABFC7914L] Appearances by: Assessee represented by : Miraj D. Shah, AR Department represented by : S.B. Chakraborthy, Sr. DR Date of concluding the hearing : 21.11.2025 Date of pronouncing the order : 25.11.2025 ORDER PER SANJAY AWASTHI, ACCOUNTANT MEMBER: 1. The present Miscellaneous Applications have been filed by the Revenue for rectification of order dated 30.09.2024, passed by the Tribunal in IT(SS)A No. 92/Kol/2024 & ITA No. 1636/Kol/2024, pertaining to the Assessment Years 2015-16 and 2016-17. The grounds of MAs are as under: Printed from counselvise.com MA Nos. 78 & 79/Kol/2025 Chirag Jewellers 2 MA No. 78/Kol/2025 “1 Whether the Hon'ble ITAT has erred in facts and in law by dismissing the appeal of revenue solely on monetary ground without considering the fact that the addition of Rs. 8,00,000/- was made by the AO under section 68 of the Act since the assessee failed to establish the genuineness of the transactions and the identity and creditworthiness of the creditors to whom interest has been paid during the year under consideration? 2 Whether the Ld. CIT(A) has erred in law by acting in contravention of the established judicial precedents of CIT vs Durga Prasad More (1971 82 ITR 540 (SC) following in the case of Sumati Dayal vs CIT (1995) 214 ITR 801: 80 Taxman 89 (SC) by deleting the addition of Rs. 8,00,000/-made by the AO? 3 That the instant case falls under exceptional clause (h) of para no. 3.1 of the CBDT's Circular No. 5/2024, dated 15.03.2024 vide F.No. 279/Misc. 142/2007- ITJ(Pt.) and therefore, the monetary limit for filing appeals by the Revenue before the Tribunal does not apply in this case. 4 The appellant craves the right to add, alter, amend or withdraw any ground of appeal before or at the time of hearing.” MA No. 79/Kol/2025 “1 Whether the Ld. CIT(A) has erred in facts and in law by allowing the appeal of the assessee by deleting the addition of Rs. 30,24,961/- made by the AO despite the assessee failing to satisfy the AO about the source of the cash found in its premises? 2 Whether the Hon'ble ITAT has erred in facts and in law by allowing the appeal of the assessee by deleting the addition of Rs. 8,00,000/- made by the AO under section 68 of the Act despite the assessee failing to establish the genuineness of the transactions and the identity and creditworthiness of the creditors? 3 Whether the Ld. CIT(A) has erred in law by acting in contravention of the established judicial precedents of CIT vs Durga Prasad More (1971 82 ITR 540 (SC) following in the case of Sumati Dayal vs CIT (1995) 214 ITR 801: 80 Taxman 89 (SC) by deleting the addition of Rs. 8,00,000/-made by the AO? 4 That the instant case falls under exceptional clause (h) of para no. 3.1 of the CBDT's Circular No. 5/2024, dated 15.03.2024 vide F.No. 279/Misc. 142/2007- ITJ(Pt.) and therefore, the monetary limit for filing appeals by the Revenue before the Tribunal does not apply in this case. 5 The appellant craves the right to add, alter, amend or withdraw any ground of appeal before or at the time of hearing.” 2. During the course of hearing, the Ld. DR emphasized on Clause 3.1(h) of CBDT Circular No. 5/2024 dated 15.03.2024. It was stated that the case involved money laundering and hence was covered within the Printed from counselvise.com MA Nos. 78 & 79/Kol/2025 Chirag Jewellers 3 exceptions mentioned in Clause 3.1(h). The Ld. AR, on the other hand, stated that there was no allegation, as per the Ld. AO’s order, of large scale money laundering as envisaged under the said Clause of the CBDT Circular (supra). In fact, it was pointed out that the small tax effect itself was evidence of the fact that there was no large-scale money laundering involved. 2.1 We have carefully considered the rival submissions and have gone through the records. We find that the Revenue has not been able to establish its case whereby the exceptions clause gets triggered in this particular case. Accordingly, we find no error in the ITAT’s order and thereby dismiss the MAs filed by the Revenue. 3. In result, these Miscellaneous Applications filed by the Revenue are dismissed. Order pronounced on 25.11.2025 Sd/- Sd/- [George Mathan] [Sanjay Awasthi] Judicial Member Accountant Member Dated: 25.11.2025 AK, Sr. PS Copy of the order forwarded to: 1. The Appellant 2. The Respondent 3. CIT(A)- 4. CIT- 5. CIT(DR) //True copy// By order Assistant Registrar, Kolkata Benches Printed from counselvise.com "