KARTIK SINGHAL,BALUGANJ, AGRA V. INCOME-TAX OFFICER, WARD 1(1)(1), AGRA, AAYAKAR BHAWAN, AGRA

ITA 73/AGR/2026

AI Insights

The case involves Kartik Singhal, the appellant, who contested the reassessment proceedings initiated by the Income Tax Officer under Section 147 read with Section 144B of the Income-tax Act, 1961, for the assessment year 2017-18. The reassessment was based on allegations that Singhal had received an accommodation entry of Rs. 1,50,000 from Shri Deepak, a purported dummy proprietor linked to the Shree Basant Oil Group. The Tribunal examined whether the reassessment was valid and whether the addition of the said amount as unexplained money under Section 69A was justified. The Tribunal concluded that the revenue failed to prove its case and that there were significant procedural lapses, including the denial of the assessee's request for cross-examination and the untested affidavit.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 846277 (ITAT-AGRA)
• Duration Of Justice: 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Agra
• Assessment Year: 2017-2018
• Appeal Filed On: 27-01-2026
• Other Referred Cases: Mehta Parikh vs. 30 ITR 181 (SC)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHAILENDRA SRIVASTAVA
• Assessee Lawyers: DEEPENDRA MOHAN
• Keywords: Reassessment proceedings; Principle of natural justice; Accommodation entries
• Section: 147; 148; 132

Judgement Text

"Page | 1 INCOME TAX APPELLATE TRIBUNAL AGRA BENCH “SMC”: AGRA BEFORE SHRI M. BALAGANESH, ACCOUNTANT MEMBER AND SHRI SUNIL KUMAR SINGH, JUDICIAL MEMBER ITA No. 73/AGR/2026 (Assessment Year: 2017-18) Kartik Singhal, 4/209, Baluganj, Agra Vs. Income Tax Officer, Ward-1(1)(1), Agra (Appellant) (Respondent) PAN: CHUPS9346E Assessee by : Shri Deependra Mohan, CA Revenue by: Shri Shailendra Srivastava, Sr. DR Date of Hearing 18/03/2026 Date of pronouncement 27/03/2026 O R D E R PER M. BALAGANESH, A. M.: 1. The appeal in ITA No. 73/AGR/2026 for AY 2017-18, arises out of the order of the ld National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘ld. CIT(A)’, in short] dated 01.12.2025 against the order of assessment passed u/s 147 r.w.s. 144B of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 16.05.2023 by the Assessing Officer, Assessment Unit, Income Tax Department (hereinafter referred to as ‘ld. AO’). 2. The Assessee has challenged the validity of assumption of jurisdiction under Section 147 of the Act and the consequential reassessment proceedings, apart from challenging the addition made in the sum of Rs. 1,50,000 under Section 69A of the Act on merits. 3. We have heard the rival submissions and perused the materials available on record. The Assessee had filed his return of income for the assessment year 2017-18 on 31-03-2018 declaring total income of Rs. 2,85,570. The Printed from counselvise.com ITA No. 73/AGR/2026 Kartik Singhal Page | 2 Learned AO noted that during the year under consideration, the Assessee had availed accommodation entry from Shri Deepak, who , according to the revenue was an accomodation entry provider through dummy concerns of Shree Basant Oil Group. According to the records of the Income Tax Department, there was a search on Shree Basant Oil Group conducted under Section 132 of the Act, wherein it revealed that through certain dummy concerns, accommodation entries were being provided to various parties. According to department, Shri Deepak was established as a dummy proprietor of dummy concerns of Shree Basant Oil Group. According to department, the Assessee had received a sum of Rs 1,50,000 from Shri Deepak and the same was sought to be construed as an accomodation entry received by the Assessee. Accordingly, proceedings under Section 148A stood initiated on the Assessee. 4. It is not in dispute that Assessee furnished the copy of computation of income, copy of bank statements, affidavit stating that he had not received any amount from Shri Deepak together with the detailed written explanations in response to the show cause notice issued. The Assessee also denied having any nexus with Shri Deepak. The Assessee even sought cross-examination of Shri Deepak before the learned AO from whose bank account, it was alleged that a sum of Rs 1,50,000 was transferred to Assessee. Despite these submissions, re-assessment proceedings stood initiated on the Assessee vide issuance of notice under section 148 of the Act under the new regime on 30-7- 2022. In the re-assessment proceedings, ignoring the aforesaid contentions of the Assessee and request for cross examination as stated supra, the learned AO sought to treat the sum of Rs 1,50,000 allegedly received from Shri Deepak as unexplained money under section 69A of the Act on the ground that nature and source of such credit was not explained by the Assessee. When Printed from counselvise.com ITA No. 73/AGR/2026 Kartik Singhal Page | 3 these contentions were raised again before the learned CITA together with the supporting case laws, the learned CITA dismissed the appeal of the Assessee by observing as under:- 8.3. Decision : I have carefully examined the assessment order and the written submission filed by the assessee. In view of the findings given by the AO in the Assessment Order, there is no merit in the contention raised by the appellant. In view of the above, the addition amounting to Rs 1,50,000/- made by the A.O. is being upheld. Hence, ground nos. 5,6,7 & 8 of appeal are dismissed. 5. We find that in the instant case, the assessee had furnished the complete bank statements before the Learned AO. The case of the assessee is that no sum of Rs 1,50,000/- was received from Shri Deepak or from any of his concerns as stated by the Learned AO. The assessee had categorically denied having even known Mr. Deepak or having received any sum from him. The assessee had also filed an affidavit in this regard. Hence, assessee had discharged his primary onus by furnishing the requisite documents that are available at his end. The assessee cannot be asked to prove the negative. The onus shifts to the revenue by proving that assessee had indeed received a sum of Rs 1,50,000/- from Shri Deepak through his dummy concerns and that the same represent accommodation entry. This onus has admittedly not been discharged by the revenue in the instant case. Further, the assessee also filed an affidavit before the Learned AO affirming his contentions. Even the affidavit was not put to test by the Learned AO. When the affidavit is not put to test by the Learned AO, then the contents of the said affidavit must be construed to be true and correct. Reliance in this regard is placed on the decision of Hon’ble Supreme Court in the case of Mehta Parikh reported in 30 ITR 181 (SC). Further, the assessee also sought for cross-examination of Shri Deepak Printed from counselvise.com ITA No. 73/AGR/2026 Kartik Singhal Page | 4 which was also not provided by the Learned AO in the instant case. Hence there is a gross violation of principles of natural justice which stands established. We also find that the Learned CITA had passed a very cryptic order without even giving a finding on the contentions raised by the assessee eventhough he had reproduced the contentions of the assessee in his order. 6. In view of the aforesaid observations, we hold that the addition deserves to be deleted for more than one reason in the hands of the assessee and is accordingly deleted. Since the relief is granted to the assessee on merits, the other legal grounds raised by the assessee need not be gone into as adjudication of the same become academic in nature and they are left open. 7. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 27/03/2026. -Sd/- -Sd/- (SUNIL KUMAR SINGH) (M. BALAGANESH) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 27/03/2026 A K Keot Copy forwarded to 1. Applicant 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi Printed from counselvise.com "