MUKUL MALHOTRA,LUDHIANA V. PR.CIT--1, LUDHIANA

ITA 105/CHANDI/2021

AI Insights

The case involves Shri Mukul Malhotra, the proprietor of M/s Shree Pitambra Alloys, who appealed against the revision of his income assessment for the Assessment Year 2011-12. The Pr. Commissioner of Income Tax, Ludhiana-1, invoked revisionary jurisdiction under section 263, leading to a revised assessment order which added further income to the assessee's declared income. The tribunal found that the original assessing officer (AO) had not adequately investigated key issues such as the source of a substantial credit entry and other financial transactions linked to the assessee, which were crucial for an accurate assessment of income.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 707148 (ITAT-CHANDIGARH)
• Duration Of Justice: 4 year(s) 1 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-07-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 20-05-2021
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ASSESSEE SINCE PAST; RAJAT KUMAR KUREEL LD
• Keywords: Set aside; Reassessment proceedings; Revision of order
• Section: 263

Judgement Text

"1 IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, CHANDIGARH PHYSICAL HEARING BEFORE HON’BLE SHRI LALIET KUMAR, JM AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपीलसं./ ITA No. 105/Chandi/2021 (िनधाŊरणवषŊ / AssessmentYear: 2011-12) Shri Mukul Malhotra (Prop. M/s Shree Pitambra Alloys) 108-C Miller Ganj Ludhiana-141003. बनाम/ Vs. Pr. CIT-1 Ludhiana. ̾थायीलेखासं./जीआइआरसं./PAN/GIR No. AYSPM-3774-D (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎकीओरसे/Appellant by : None ŮȑथŎकीओरसे/Respondentby : Sh. Rajat Kumar Kureel (CIT) – Ld. DR सुनवाईकीतारीख/Date of Hearing : 03-07-2025 घोषणाकीतारीख /Date of Pronouncement : 08-07-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. By way of this appeal, the assessee assails invocation of revisionary jurisdiction u/s 263 by Ld. Pr. Commissioner of Income Tax, Ludhiana-1 (Pr.CIT) for Assessment Year (AY) 2011-12 vide impugned order dated 29-03-2021 proposing revision of assessment as framed by Ld. AO u/s.143(3) r.w.s. 147 of the Act on 10-12-2018. At the time of hearing, none appeared for assessee. The perusal of order sheet entries would reveal that none is appearing for assessee since past 2 several occasions. Left with no option, we proceed with the disposal of appeal on the basis of case records. The Ld. CIT-DR advanced arguments supporting the revision of the order. 2. It emerges that the assessee was subjected to reassessment proceedings wherein the assessee was directed to explain the source of credit of Rs.38.25 Crores. The Ld. AO determined income of Rs.3.80 Lacs in its order dated 10-12-2018. Upon perusal of case records, Ld. Pr. CIT observed that during the year, the assessee has maintained a Bank Account No.2592560005321 with HDFC Bank Ltd. which, inter- alia, reflected payment to M/s Soumya Industries (sole proprietorship of the assessee). However, the Ld. AO failed to verify this bank account. Further, no details were furnished by the assessee regarding commission income. The Ld. AO also did not verify cash payment made in contravention of Sec.40A(3) of the Act. Accordingly, the assessee was show-caused. Though the assessee opposed revision of the order, Ld. Pr. CIT held that the order was erroneous and prejudicial to the interest of the revenue. The Ld. AO was directed to pass a fresh order considering the points raised in the revisionary order. Aggrieved, the assessee is in further appeal before us. Pursuant to impugned order, another assessment has been framed on 31-03-2022 wherein Ld. AO has made further addition of Rs.5.51 Crores to the already assessed income of Rs.3.80 Lacs. The assessment has been framed on best judgement basis since the assessee has failed to make the required submissions in set aside proceedings. 3 3. Upon perusal of impugned order of Ld. Pr. CIT and regular assessment order dated 10-12-2018, it could be seen that Ld. AO has failed to make requisite enquiries on issues which have been flagged by Ld. Pr. CIT in the impugned order. The assessee has maintained Bank Account No.2592560005321 with HDFC Bank Ltd. which, inter- alia, reflected payment to M/s Soumya Industries which happens to be the sole proprietorship of the assessee. Thus, few of the transactions of HDFC Bank had linked with the assessee and the same had bearing on determination of assessee’s income which Ld. AO has failed to verify. There is nothing on record to suggest that any such verification was made by Ld. AO during the course of regular assessment proceedings. This being so, we uphold the revision of the order. 4. The appeal stands dismissed. Order pronounced on 08-07-2025. Sd/- Sd/- (LALIET KUMAR) (MANOJ KUMAR AGGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 08-07-2025. आदेश की Ůितिलिप अŤेिषत /Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF ASSISTANT REGISTRAR ITAT CHANDIGARH "