JAMALUDDIN SIDDIQUI,KANNAUJ, U.P V. COMMISSIONER OF INCOME TAX (APPEALS), NFAC/ DCIT CIRCLE 4(1)(1), ALIGARH, NFAC/ ALIGARH, U.P

SA 2/AGR/2026

AI Insights

The case involves a stay application by Jamaluddin Siddiqui Dil Pasand Biri Company against an outstanding tax demand for the Assessment Year 2018-19, which was based on an alleged unexplained cash credit under section 68 of the Income Tax Act, 1961. The dispute arose from a clerical error by a newly appointed accountant, who mistakenly used a group balance sheet for risk analysis instead of the individual balance sheet, leading to a misrepresentation of the assessee's net worth. This error resulted in a significant addition to the assessee's income, prompting the tax demand. The Tribunal considered the circumstances, including the freezing of the assessee's bank account and the impact on business operations, and decided to grant the stay to prevent further financial distress.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 837894 (ITAT-AGRA)
• Duration Of Justice: 1 month(s) 5 day(s)
• Appeal Type: Stay Application
• Pronouncement Date: 20-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2018-2019
• Appeal Filed On: 15-01-2026
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUKESH KUMAR JAIN
• Assessee Lawyers: V. C. MISHRA
• Keywords: Revised return; Unexplained cash credit; Application of stay
• Section: 143(3); 68

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI SUNIL KUMAR SINGH, JUDICIAL MEMBER Stay Application No. 02/AGR/2026 (Arising out of ITA No. 31/AGR/2026) Assessment Year: 2018-19 Jamaluddin Siddiqui Dil Pasand Biri Company, Gandhi Nagar, Gursahaiganj Vs. DCIT, Circle 4(1)(1), Aligarh PAN : AAVPJ6207F (Appellant) (Respondent) Assessee by Sh. V. C. Mishra, CA Department by Sh. Sukesh Kumar Jain, CIT-DR Date of hearing 20.02.2026 Date of pronouncement 20.02.2026 ORDER PER : S. RIFAUR RAHMAN, ACCOUNTANT MEMBER: Stay application filed by the assessee seeking stay of outstanding demand raised as per the order passed u/s 143(3) r.w.s 144B of the Income Tax Act, 1961 for the Assessment Year 2018-19. 2. At the time of hearing, ld. AR of the assessee submitted that there is a disputed demand of Rs. 9.91 crores in the appeal preferred by the assessee vide ITA No. 31/AGR/2026. He submitted that there is a fit case in favour of the assessee for the reason that assesssee’s net worth Printed from counselvise.com ITA No.36/Agr/2025 2 | P a g e as Proprietors Capital in ITR form was mistakenly compared with proceeding years ITR and wrongly construed as infusion of additional capital of Rs. 8,31,87,462/- and the same was treated as unexplained cash credit u/s 68 of the Act. It was further submitted that as a routine practice assessee prepares two balance sheets for the group, one balance sheet prepared individually on the basis of actual net worth and the other balance sheet is to evaluate overall risk of the group consolidating proprietorship entities i.e. Jamal Bidi Company and Bengal Bidi Company for the year ending 31st March, 2018. The assessee has already submitted individual balance sheet before the authorities. Further he submitted that while filing the return of income the accountant wrongly entered the group balance sheet which was prepared for risk analysis wrongly entered as the net worth of the assessee, the accountant being newly appointed, due to above clerical mistake, the Assessing Officer has proceeded to make the huge addition. Because of this the bank account of the assessee was frozen and the assessee is not able to run the business. The above clerical mistake have made the whole business comes to stand still. He prayed that stay may be granted and early hearing granted to render justice. Printed from counselvise.com ITA No.36/Agr/2025 3 | P a g e 3. On the other hand, ld. DR objected the above submissions of the assessee and submitted that the assessee himself has declared the net worth in the return of income and also in the revised return of income. Therefore, the assessee has not demonstrated what is the balance of convenience in favour of the assessee. 4. Considered the rival submissions and material placed on record. We observe that the demand arises out of the addition made u/s 68 of the Act on the basis that assessee has declared Proprietors Capital in his return of income from the balance sheet which was prepared for the purpose of bank to analyse the risk, which was prepared consolidating the other concerns which is not the real individual capital of the assessee. The above mistake is due to clerical mistake of the new accountant. We observe the above details were furnished by the assessee in his return of income and also in the revised return of income. It is further brought to our notice that the bank account of the assessee was frozen and assessee is not able to operate the same and the business has comes to stands still. Considering the peculiar nature of facts on record, we are inclined to grant stay for the total outstanding demand with the condition that the assessee to pay Rs. 20 lakhs immediately, on receipt of above mentioned Rs. 20 lakhs and proof of Printed from counselvise.com ITA No.36/Agr/2025 4 | P a g e the same may be produced before the Assessing Officer, accordingly, the stay is granted for balance outstanding. We direct the Assessing Officer on receipt of the proof of payment, the bank attachment be lifted immediately. Therefore, the stay is granted for the balance outstanding demand for a period of 180 days or till the disposal of pending appeal, whichever is earlier. Further, the appeal filed by the assessee fixed for hearing out of turn on 16.03.2026. No separate notice shall be issued as the date of hearing was announced in the open court. In the result, stay application filed by the assessee is allowed in above terms. Order pronounced in the open court on 20.02.2026. Sd/- Sd/- (SUNIL KUMAR SINGH) (S. RIFAUR RAHMAN) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 20.02.2026 *Ganesh Kumar, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, Agra Printed from counselvise.com "