LOVISH GUPTA,DELHI V. NATIONAL E-ASSESSMENT CENTER, DELHI

ITA 3892/DEL/2024

AI Insights

The case involves multiple appeals related to the assessment year 2017-18, where the primary issue was the addition of unexplained money amounting to Rs. 3,40,21,130 in the assessee's bank account under section 69A of the Income Tax Act, 1961. The Assessing Officer (AO) initially made this addition based on bank statements showing large cash deposits during the demonetization period. The CIT(A) later reduced this amount to Rs. 85,30,989 after considering certain explanations and documentary evidence provided by the assessee. However, both the AO and CIT(A) had erred in the assessment process, including the use of an incorrect PAN for the assessee. The Tribunal found merit in the assessee's arguments and restored the matter to the AO for a fresh assessment under the correct PAN.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 312253 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHANKAR LAL
• Assessee Lawyers: RAJAT GUPTA
• Keywords: Set aside
• Section: 144

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH ‘E’’ : NEW DELHI) BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENT AND SHRI MANISH AGARWAL, ACCOUTANT MEMBER ITA NO. 3892/Del/2024 AND ITA NO. 4016/DEL/2024 AND ITA NO. 4017/DEL/2024 Asstt. Year : 2017-18 Lovish Gupta, vs. National E-assessment Center, 81, Ground Floor, Delhi / ITO, WARD 43(8) / Church Mission Road, ITO, WARD 43(6), DELHI Fatehpuri, Delhi – 110 006 (PAN: AHUPG8219L) (Appellant) (Respondent) ITA No. 4121/Del/2024 Asstt. Year : 2017-18 National E-Assessment Center, vs. Lovish Gupta, Delhi 81, Ground Floor, Church Mission Road, Fatehpuri, Delhi – 110 006 (PAN: AHUPG8219L) (Appellant) (Respondent) Appellant by : Shri Rajat Gupta, CA Respondent by : Shri Shankar Lal, Sr. DR. Date of Hearing 28.04.2025 Date of Pronouncement 28.04.2025 2 ORDER PER MAHAVIR SINGH, VP ITA Nos. 3892 & 4121/Del/2024 are the cross appeals filed by the assesse as well as revenue respectively, arising out of the order of NFAC, Delhi in Appeal No. CIT(A), Delhi-5/10785/2019- 20 dated 31.05.2024. Assessment was framed by the ITO, Ward 43(8), New Delhi for the assessment year 2017-18 u/s. 144 of the Income Tax Act, 1961 (hereinafter referred as “Act”) vide order 24.12.2019. 2. At the outset, it is noticed that the Assessee’s appeal (ITA No. 3892/Del/2024) is time-barred by 25 days. On being asked, it was stated by the Ld. AR that the delay in filing the appeal was caused due to violent robbery attack on the assesse in the month of July on National Highway-24, near the Rai Industrial Area, Sonipat, Haryana when the assesse was returning home from his factory. The robbery incurs significant property loss, injury and trauma which was experienced by the assesse, as he was subjected to physical violence and intimidation. Therefore, though the order of the NFAC was communicated to him on 31.05.2024, he filed the 3 appeal on 24.8.2024, which is delayed by 25 days, hence, he requested for said condonation of delay. Ld. DR objected the plea of the assesse for condonation of delay. Going by the reasons, stated, we are convinced that the cause for delay in filing the appeal is reasonable due to smallness of delay and reasons stated therein. Thus, we condone the delay of 25 days and accordingly admit the appeal of the assessee. 3. The only common issue in these cross appeals, is as regards to order of the Ld. CIT(A) restricting the addition of Rs. 85,30,989/- out of the total addition made by the AO at Rs. 3,40,21,130/- u/s. 69A of the Act on the ground of unexplained money in the bank account without adequately considering the submissions and documentary evidences filed by the assessee. 4. We observed that AO noted from the bank statements that the assesse has deposited cash in bank account during demonetization period of Rs. 27 lacs and all credits entry (including cash) amounting to Rs. 3,40,21,130/-. As none was present before the AO during assessment proceedings, AO resorted to the provisions of section 144 of the Act and framed best judgement assessment and made addition of Rs. 3,40,21,130/-. The AO taxed the same u/s. 4 115BBE of the Act. The Ld. CIT(A) restricted the addition of Rs. 85,30,989/- out of the total addition of Rs. 3,40,21,130/-. The Ld. CIT(A) deleted the addition of Rs.2,54,90,141/- being amount of loan payment reversed and credits were received from the following entities:- S.No. Source of deposit Amount 1 ASM & Co. – Outstanding balance of debtor received during the year 1,31,00,000 2 Lovish Traders Pvt. Ltd. – Outstanding balance of debtor received during the year 6,35,000 3 Mohan Lal Mali Ram Sweets – Outstanding of debtor received during the year 2,50,000 4 Sindhi Namkeen and Dry Fruits – Outstanding balance of debtor received during the year 2,00,000 5 India Food Traders – Unsecured loan received during the year to pay outstanding balance of creditor. The entire amount was repaid during the year. 23,05,000 6 India Overseas – Unsecured loan received during the year to pay outstanding balance of creditor. Sum of Rs. 47,00,000/- was repaid during the year. 77,10,000 7 Lovish Gupta 25,30,000 8 Suresh Kumar Gupta 39,10,000 5. The ld. CIT(A) sustained the addition in regard to the following parties:- 5 S.No. Source of deposit Amount 1 Sindhi Namkeen and Dry Fruits – Outstanding balance of debtor received during the year 12,00,000 2 ASM & Co. – Outstanding balance of debtor received during the year 1,31,989 3 Narayan Das Talwani (Claim settlement) Court order placed at PB page no……. 19,00,000 4 Lovish Gupta 7,59,000 5 HDFC Bank Withdrawal 1221000 6 Kotak Bank withdrawal 1331000 S.No. Cash utilization Amount 1 Deposit in HDFC Bank 51,03,000 2 Deposit in Kotak Bank 13,31,000 6. Now before us, Ld. Counsel for the assessee stated that this assessment proceedings was initiated on wrong PAN by passing the exparte assessment order u/s. 144 of the Act by the AO without verifying that the assesse has already filed return of income under a different PAN according to assesse. He further stated that the entire assessment proceedings has to be reframed under a correct PAN and hence the matter may be restored back to the file of the AO. When these facts were confronted to Ld. Sr. DR, he also agreed that since the assessment was made under wrong PAN and accordingly the plea of the assesse is genuine. 6 7. After hearing both the sides and keeping in view of the aforesaid factual matrix, we set aside the order of the Ld. CIT(A) and that of the AO and restore these two cross appeals to the file of the Assessing Officer for fresh adjudication, keeping in view the aforesaid factual matrix, in accordance with law. 8. In the result, both the cross appeals filed by the assessee as well as revenue are allowed for statistical purposes in the aforesaid manner. 9. Coming to ITA No. 4016/Del/2024, Ld. Counsel for the assesse stated that this order of the NFAC dated 09.02.2024 in Appeal No. NFAC/201617/10112322 for the same assessment year 2017-18 which shows that there was duplication in filing the appeal and the Ld. CIT(A) treated as this is a belated appeal, hence, he requested that this appeal being ITA No. 4016/Del/2024 be treated as withdrawn. Accordingly, this appeal is dismissed as ‘withdrawn’, keeping in view the aforesaid factual matrix. 10. Coming to ITA No. 4017/Del/2024, Ld. Counsel for the assessee stated that this is a penalty appeal, wherein penalty levied by AO u/s. 271AAC(1) of the Act. Ld. Counsel for the assessee stated that this penalty appeal is arising out of the assessment framed originally by the AO, which has already been set aside in Assessee’s ITA No. 3892/Del/2024 (AY 2017-18), as above, this penalty appeal 7 has also been set aside to the file of the AO with the liberty to reinitiate the penalty proceedings, after making a fresh assessment, in accordance with law. Accordingly, we set aside this appeal of the assessee to the file of the AO in very terms. Resultantly, this appeal of the Assessee is allowed for statistical purposes. 11. To sum up: Assessee’s quantum appeal being ITA No. 3892/Del/2024 (AY 2017-18) and penalty appeal being ITA No. 4017/Del/2024 (AY 2017-18) and Revenue’s Appeal being ITA No. 4121/Del/2024 (AY 2017-18) are allowed for statistical purposes and Assessee’s ITA No. 4016/Del/2024 (AY 2017-18) stands dismissed. Order pronounced in the Open Court on 28.04.2025. Sd/- Sd/- (MANISH AGARWAL) (MAHAVIR SINGH) ACCOUNTANT MEMBER VICE PRESIDENT SRBhatnagar Copy forwarded to: - 1. Appellant 2. Respondent 3. DIT 4. CIT (A) 5. DR, ITAT TRUE COPY By Order, Assistant Registrar, ITAT, Delhi Benches "